M&As: Developing nations to overtake western world

Developing nations will overtake their western counterparts in cross-border mergers and acquisitions activity, a new report has predicted.
Accountancy firm KPMG analysed deal flows between nine emerging economies and has claimed BRIC nations (Brazil, Russia, India and China) are “fast closing the gap” on developed economies.

It said India was “easily the most acquisitive” of the nations, and claimed within the first half of 2007 an “impressive” total of 32 outbound deals were recorded. In all of 2006, 50 such deals took place.
Chairman of KPMG’s new and emerging markets practice in the UK Ian Gomes said: “The large volume of outbound deals is indicative of the current mindset of many Indian companies; grow, acquire and utilise debt facilities to the full.”

However, he warned companies’ haste to “hit the acquisition trail” could lead to their over-paying for assets.

KPMG provides auditing, tax, financial and risk advice across 148 countries.