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According to Mahindra & Mahindra, Mergers and Acquisitions (M&A) form the basic growth
mantra. With greater exposure to markets abroad and increased competitiveness, Corporates
have successfully faced the challenges of competing on foreign front and have achieved
success and self-confidence.
Foreign institutional funds have provided crucial support to a long-term rally in the Indian capital
market, pumping a record US $10.7 billion into the market in 2005, and buying shares worth
over US $3.37 billion thus far this year. Indian firms are becoming global and, if the trend
continues, there will be a flood of homegrown multinational companies operating all around the
world.

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forms a key part of the Group¶s basic philosophy of enhancing global reach
and competitiveness.
For the Mahindra Group, which is fast establishing its international footprint, Mergers &
Acquisitions are at the core of the growth strategy, they have now become a continuous
process.

In order to respond to these challenges, a special   cc c  has evolved in
the last two years. It is notable that most organizations use the services of Investment Bankers,
who are specialists in arranging M&A transactions. However, with its in-house expertise, M&M¶s
M&A Cell itself most often carries out such activities traditionally carried out by Investment
Bankers themselves, thus saving millions of dollars for the organization.


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In the Telecom & Software Sector, Mahindra British Telecom is India¶s top telecom software
solutions company and provides IT solutions to the global telecommunications industry. A global
office network of three thousand professionals covering four continents serves clients that
include British Telecom, Alcatel, Ericsson, Vodafone, Qatar Telecom, and eServe Global.

Take the case of Tech Mahindra¶s acquisition of Axes Technologies, which has brought in
complementary capabilities, deep domain knowledge and access to two large clients in an
unexplored segment in the Telecom industry. This acquisition enables M&M to enhance their
offerings to leading Telecom Equipment Manufacturers, which is a major segment of their
chosen market.


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The Farm Equipment Sector has been the market leader in India for twenty-two years. M&M
designs, develops, manufactures, and markets tractors, associated implements, and industrial
engines. In tractors it ranks fourth in the world and number one in India. It has 450 dealers for
sales, service, and spare parts reaching customers throughout India, along with a network of
140 dealers in the United States though a subsidiary, Mahindra USA. c

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The Infrastructure Development Sector develops commercial and residential real estate
properties and infrastructure, manages India¶s first fully integrated Business City in a Special
Economic Zone public-private partnership, and includes Mahindra Holidays & Resorts India Ltd.
thirteen resorts and over forty thousand members and is beginning to target overseas markets.

M&M¶s acquisition of Plexon Technologies is another case in point. Plexion is engaged in the
business of Computer Aided Engineering Services and has operations in Asia, Germany, U.K
and USA. It is focused on Aerospace & Automotive Engineering business verticals and its
delivery model includes offshore and onsite services.
The acquisition of Plexion complements the capabilities of Mahindra Engineering Services and
provides additional resources that can be brought to bear to meet the increasing needs of
equipments like International Truck and others.


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The Trade & Financial Sector includes an import-export arm, a steel service center in the United
Arab Emirates, and the largest rural private finance company in India, which offers loans and
insurance to underserved rural areas. Mahindra Systems & Automotive Technology designs,
engineers, and produces material for major auto manufacturers in India.

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M&M¶s acquisition of 51% of SAR Automotive Transmission Products Private Ltd., Gujarat to
form a joint venture
Demerging of the Chakan Division of Amforge Industries Ltd. and its subsequent merger with
Mahindra Automotive Steel Ltd.
M&M¶s acquisition of 88.41% stake in Plexion Technologies (India) Pvt. Ltd.
M&M acquisition of an 98.6% stake in Stokes Group Limited, U.K. (Stokes)
M&M¶s JV with Jiangling Tractor Company (JTC) in the People¶s Republic of China
Merger of group companies with MUSCO (Mahindra Ugine Steel Co. Ltd.)
Merger of Mahindra Information Technology Services & Mahindra Ecomobiles Ltd. into M&M
Merger of Mahindra Realty & Infrastructure Ltd. into Mahindra Engineering & Construction Ltd.
Merger of Mahindra Auto Specialties Ltd., Alternative Technologies Ltd., and E-Mahindra Ltd.
into M&Mc
Ongoing International deals include acquisitions in China, Germany, Poland and the US.
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The typical steps in an acquisition process include:
1. Deal Origination
2. Execution of Non Disclosure Agreement (NDA)
3. Receipt & Analysis of information & selection of advisor
4. Execution of non binding Expression of Interest/ Letter of Intent (EOI / LOI)
5. Due Diligence process
6. Negotiating Transaction Documents
7. Obtaining approvals (Internal & External)
8. Closing procedures

References:



     

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