Distressed asset sales 3% of overall M&A in 2017: Report

The first year of the bankruptcy laws has seen many investors setting up special vehicles to snap up distressed assets which constituted 3 per cent of the entire mergers and acquisitions in the year, says a report. Total distressed asset merger & acquisitions has totalled USD 14.3 billion led by deals like Bhsuhan Steel (USD7.4 billion), Reliance Communications (USD 3.7 billion) and Fortis Healthcare (USD 1.2 billion), financial consultancy Kroll said in note Monday. In terms of actual deals, distressed M&As accounted for 3 per cent of total M&A volume in the market.

This was only 21 of the total 623 deals completed since 2017, it said. As for investor groups, it said so far domestic dealmakers have led the distressed M&As accounting for 90 per cent of the deals by value and 81 per cent by volume. Foreign investors have played a silent role” thus far with Malaysian IHH Healthcare and Singaporean Wilmar International’s USD 122 million deal to acquire Shree Renuka Sugars, it said. The report said in addition to the over 900 cases already admitted to NCLTs, another 600-1,000 are expected to bankruptcy courts in the next 12-18 months

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