presents

M&A Dealscope
For the future I-bankers

Indian Institute of Management

Indore

Key M&A deals since Jan 2014

Announcement Date

Acquirer

Target

Industry

Deal Value

20th Nov, 2014

BFSI

14,850 cr

16th Nov, 2014

Power

9,700 cr

29th Oct, 2014

E-Commerce

3,837 cr

29th Oct, 2014

Transportation

1,260 cr

18th Sept, 2014

Biotech

380 cr

13th Aug, 2014

Power

6,000 cr

5th Jun, 2014

BFSI

790 cr

16th May, 2014

Infrastructure

5,500 cr

7th April, 2014

Pharma

24,088 cr

13th Feb, 2014

Media

$ 45.2 Bn

7th Jan, 2014

Food

1,750 cr

Deal value in Rupees unless mentioned otherwise

Kotak Mahindra Bank acquires ING Vysya Bank

Deal Overview and Structure

Deal Financials and Multiples

On November 20th, 2014, Kotak Mahindra announced merger

with ING Vysya Bank in an all-stock amalgamation

Equity Value (Rs. crores)

14,850

Enterprise Value (Rs. Crores)

14,850

ING Vysya shareholders will receive 725 shares in Kotak for

1,000 shares of ING Vysya
This exchange ratio indicates an implied price of Rs.790 for
each ING Vysya share based on the average closing price of
Kotak shares during one month to November 19, 2014, which
is a 16% premium

P/E

23.6x

P/B

2.0x

The proposed merger would result in issuance of ~15.2% of

the equity share capital of the merged Kotak

Deal Rationale
Kotak with relatively deeper presence in the West and North,
has a differentiated proposition for customer segments

Wider coverage and balanced footprint

Branches

ING

Kotak

Merged

ING Vysya has deep presence in South India, particularly in

Andhra Pradesh, Telengana and Karnataka and is particularly
noted for SME Business

West

12%

46%

30%

North

20%

34%

27%

The combined Kotak will have 1,214 branches, with a panIndia network, given the strong geographic complementarity

South

64%

15%

38%

Kotaks strong capital position will help in avoiding capital

raising and possible dilution for ING Vysya shareholders

East

4%

5%

5%

Total

573

641

1,214

Merger would yield more liquidity with significant foreign

headroom with foreign shareholding at ~47%
Source: Merger Filings, Company Filings, Press

BFSI

Kotak Mahindra Bank acquires ING Vysya Bank

Time

Less need for branch

expansion
Save on product
introduction costs
Origination cost
savings higher
throughput of products
through network
Save on overlap of
infrastructure
Commentary
is a momentous occasion that brings together two
This
banking institutions with significant complementary

believe this transaction brings significant value to all

We
Ranbaxy shareholders. Sun Pharma has a proven track

strengths. The opportunities and synergies that this merger

will create will place Kotak and its incoming stakeholders
from ING Vysya on a new trajectory of excellence and
leadership. I firmly believe this merger will pave the way for
a bigger and better financial services player with deep
Indian roots and global standards of service
Uday Kotak, MD, Kotak Mahindra Bank

record of creating significant long-term shareholder value

and successfully integrating acquisitions into its growing
portfolio of assets. We are confident that Sun Pharma is the
ideal partner to help us realize our full potential and are
excited to participate in future value creation opportunities.
Shailendra Bhandari, MD and CEO, ING Vysya Bank

Source: Merger Filings, Company Filings, Press

BFSI

JSW Energys acquisition of

Hydro Power Projects from JP Ventures
Deal Overview and Structure

Deal Financials and Multiples

On November 16th, 2014, JSW Energy announced the

acquisition of 100% stake in the two Hydroelectric Plants
from JPVL and other shareholders with a total capacity of
1,391 MW for Rs 9,700 crore in cash
The two hydroelectric power plants namely, Baspa II hydro
electrical project and Karcham Wangtoo hydro electrical
project both in Himachal Pradesh will enhance the power
generation capacity of JSW Energy to 4531 MW

Enterprise Value (Rs. Crores)

Deal Rationale

Other Details

Jaiprakash Industries will obtain liquidity and reduce debt

currently mounting to around Rs 60,000 crore
Deal will enable JSW Energy to become the largest hydro
power producer in the private sector in the country and also
help it in achieving its long term aim of having 12000 MW of
power generation capacity by 2025
For JSW Energy, it gets sizeable and operational assets minus
the waiting period that takes to construct such assets. Given
Rs 12,000-15,000 crore cash on JSWs books and no near-term
growth plans, deal gives JSW an opportunity to buy growth

Prior to striking the deal with JSW Energy, Jaypee group had
approached other buyers including Reliance Group and Adani
Group but these could not solidify due to difference of opinion
on valuations.
The acquired plants Baspa and Karcham Wangtoo have a life
of 29 years and 37 years respectively with additional increase
in life possible up to 20 years
Jaiprakash Industries had recently lost its coal mines due to
cancellation of coal blocks. It plans to use the cash generated
from the deal to bid for the new coal block auction

9,700

EV/Sales

6.2x

EV/EBITDA

9.7x

P/E
EV/MW (Rs. Crores)

46.6x
7.0

Commentary
Group continues to be on course to bring down its debt
is an attractive deal for our shareholders, as it is expected
This
Jaypee
and consolidate its operations in the given economic scenario,
to be earnings accretive on closure. Our Strategy is to increase
which necessitates all credible organizations to respond to the
challenges in a pro-active manner and unlock and enhance
share holder value
Manoj Gaur
Executive Chairman and CEO, Jaypee Group

capacity manifold and create synergies through a mix of

organic and inorganic opportunities, supported by excellence
in operations to accelerate the growth in shareholder value.
Sajjan Jindal
Chairman and MD, JSW Energy

Source: Merger Filings, Company Filings, Press

Power

SoftBank Corp. invests in Snapdeal and Ola Cabs

Deal Overview and Structure

Deal Overview and Structure

On October 29th, 2014, SoftBank announced investment of

$627 million (Rs 3,847 crore) in Snapdeal, becoming the
largest shareholder with ~30% stake
Pressure had been growing on Snapdeal to raise funds to
compete as online retail surges in India, with local industry
leader Flipkart raising $1 billion in July, and global ecommerce giant Amazon.com pledging to invest a further $2
billion in its India unit

On October 29, 2014, SoftBank announced investment of $210

million (Rs 1,260 crore) in Ola Cabs at a valuation of nearly $1
billion (Rs 6,100 crore)
This is Ola cabs Series D funding, its earlier investors include
Tiger Global Mgmnt, Sequoia Capital and Steadview Capital

Deal Rationale
Snapdeal plans to
Invest $250m in technology and supply chain management,
in addition to making acquisitions specifically in the area of
mobile technology
Open innovation centres in Hyderabad and Pune and
double its technology team size to 1,000 people by FY15
end
Set up an incubation centre for startup businesses in the
mobile technology space in the next six months
Expand its fulfilment centres to 30 cities
Deal is a strategic investment made by SoftBank to capitalise
on the rapid growth for e-commerce in India, and to leverage
synergies between Snapdeal and its portfolio companies

Deal Financials and Multiples

Equity Value (Rs. crores)

12,823

Enterprise Value (Rs. Crores)

12,823

EV/Sales

76.3x

Deal Rationale
Ola Cabs plans to use the funds for
Geographical Expansion- To have a presence in at least 20
cities by end of 2014
Introduce 20,000 Kaali-Peeli taxis across Mumbai.
Invest Rs 100 Crore to have one million drivers in the next
3 years
Invest in its technology platform as well as expand its
footprint to smaller cities

Deal Financials and Multiples

Equity Value (Rs. crores)

6,100

Enterprise Value (Rs. Crores)

6,100

EV/Sales ( Based on FY14 estimates)

10.2x

Commentary
We believe India is at a turning point in its development and
have
confidence that India will grow strongly over the next
decade. As part of this belief, we intend to deploy significant
capital in India over the next few years to support development
of the market.
Masayoshi Son, CEO SoftBank Corp

Source: Merger Filings, Company Filings, Press

E-Commerce & Transportation

Silver Leaf Oaks acquisition of stake

in Syngene International
Deal Overview and Structure

Deal Financials and Multiples

On September 18th, 2014, Silver Leaf Oak, an investment

vehicle advised by India Value Fund Advisors acquired
minority 10% stake in Syngene International, Biocons
Research Services subsidiary for Rs 380 crores entailing
enterprise valuation of Rs.3,800 Crore
Post the completion of this transaction, Biocon and BRL will
jointly hold 85.54% stake in Syngene
The remaining 4.46% shareholding is held by some entities
such as trusts and employees stock options

Deal Rationale
Biocon aims to unlock value of its Research Services business
by listing Syngene in the near-term
Further as per SEBI Regulations, public holding at the time of
listing has to be 25%, so in order to faciliate the same Biocon
bought back stake from GE and sold it later to IVFA

Equity Value (Rs. crores)

3,800

Enterprise Value (Rs. Crores)

3,800

P/E

28.4x

EV/Sales (x)

5.4x

P/BV (x)

5.8x

Other Details
Biocon acquired GE Capitals entire 7.69% stake in Syngene
for Rs 215.38 crore on 9th September
Earlier in October 31, 2012, Biocon had sold the stake to GE
for Rs 125 crore

Commentary
investment reflects Syngenes leading position in the
We had partnered with Biocon through our first fund in 2003.
This
We
contract research and manufacturing space in Asia,
are excited to partner with them again. Syngene has
acknowledging
its
comprehensive
multidisciplinary
capabilities. This transaction is part of the overall strategic
plan for Syngene and sets a new benchmark as we prepare the
company for listing
Kiran Mazumdar-Shaw
Chairman and MD, Biocon

emerged as one of the leading service providers globally for

integrated discovery and development with a marquee client
base. This deal showcases the IVFA investment philosophy of
working with high quality entrepreneurs and management
teams
Vishal Nevatia
Managing Partner, India Value Fund Advisors

Source: Merger Filings, Company Filings, Press

Biotech

Adani Power acquires Udupi Power Plant

Deal Overview and Structure

Deal Financials and Multiples

On August 13th , 2014, Adani Power announced acquisition of

Lanco Infratechs Udupi Power plant with capacity of 1200
MW for an Enterprise Valuation of Rs 6000 crore including
debt of Rs 4000 crores
Udupi Power Plant also has an agreement with Karnataka
Government for further expansion of 1320 MW
Thermal power plant is based on 100% import coal with a
captive jetty of 4 MTPA and an external coal handling system
in the new Mangalore Port Trust. The capacity can be, if
required, expanded to handle another 4 MTPA capacity
Work on further expansion of 660 MW is already underway

Deal Rationale
Will help Lanco with some cash and help it to reduce debt
For Adani Power, Udupi power plant will help in capacity and
geographical expansion
Adani Power will focus on expanding capacity of Udupi
expeditiously leveraging its execution capabilities
IDFC believes that the deal will be value-accretive for Adani
Power in the long term

Commentary
these assets still have contract and fuel-related
Although
challenges, the fact that they are operating assets removes the
entire development risks like land acquisition, clearances and
construction delays etc. for the buyer.
Debasish Mishra
Senior Director (Consulting), Deloitte Touche Tohmatsu

Equity Value (Rs. crores)

2,000

Enterprise Value (Rs. crores)

6,000

EV/EBITDA

4.2x

P/E

9.8x

EV/MW (Rs. Crores)

5.0

Other Details
Udupi Plant has been facing operational issues that even led to
stoppage of production in June

Lanco had put the power plant on the block two years ago as
well, to use the proceeds to lower its consolidated debt
Additionally these are ready assets, so despite the regulator
overhang there are no development risks like land,
environment clearance or construction delays
Lanco had invested Rs 6,320 crore as the total project cost as a
combination of debt and equity. With deal done at book value,
Adanis will inherit the project related debt and Lanco's
promoters will get paid for the equity they paid for
Adanis will also have rights over the Rs 1,800 crore
receivables from the Karnataka SEB due to which most
analysts feel the Udupi plant's valuation is a steal

Source: Merger Filings, Company Filings, Press

Power

Piramal acquires stake in Shriram Group

Deal 1: PEL acquires 20% stake in Shriram Capital

Deal Financials and Multiples

On April 17th, 2014, Piramal Enterprises announced

acquisition of an effective 20% stake in Shriram Capital for a
consideration of Rs. 2014 crore

Particulars

Deal 1

Deal 2

Equity Value (Rs. crores)

10,070

7,932

Shriram Capital is the holding company which controls

Shriram Transport Finance Co Ltd (26.05%) and Shriram City
Union Finance. (37.56%)

Enterprise Value (Rs. Crores)

10,070

7,932

12.6x

15.0x

Earlier in May 2013, PEL had invested Rs. 1,636 crore to

acquire 9.9% stake in Shriram Transport Finance Company,
one of the listed NBFCs of the Shriram Group

P/BV

NA

2.64x

Deal 2: PEL acquires 9.9% stake in Shriram City Union

On 5th June, 2014, Piramal Enterprises Limited announced an
acquisition of 9.9% equity stake in Shriram City Union Finance
Limited for 790 crore.
The current deal takes PELs total investment in the Shriram
Group to Rs. 4,440 crore

Deal Rationale
Partnering with Piramal will help the Shriram Group, currently
tagged as a south Indian company, to take the brand national
and also end its reliance PE players for funding
Shriram Group was keen to rope in a partner with a long-term
vision and one that could stay the course with his group
Piramal on the other hand, gets a platform for entering into
financial services, especially in rural areas and will be able to
channelize its excess cash to earn expected return of 17%18%

P/E

Other Details
Ajay Piramal, the owner of Piramal Enterprises, is said to take
over as the non-executive chairman of the Shriram Capital.
Shriram Group could go in for inorganic growth and can
contemplate acquisitions in rental and equipment business,
housing finance and micro-, SME enterprise and BPO
companies
Group also has an eye on the insurance sector, not only in
Thailand, but also at home and could buy foreign investors
wanting to exit from their insurance JVs
The group is not looking at any more strategic partners,
though Shriram Transport and Shriram City Union Finance
might consider new investors later
The three main partners - Shiram Employee Trust, South
Africa-based Sanlam Group and Piramal Group-- will become
equal partners in Shriram Capital over the period

Source: Merger Filings, Company Filings, Press

BFSI

Adani Ports and SEZs acquisition of Dhamra Port

Deal Overview and Structure

Deal Financials and Multiples

On 16th May, 2014, Adani Ports and SEZ Ltd. (APSEZ)

announced the acquisition of 100% of Dhamra Port, a 50:50
Joint Venture Company of Larsen & Toubro IDPL and Tata
Steel, for an enterprise value of Rs. 5,500 crore
This is the largest port sector deal in India after Pipapav port
in Gujarat was acquired by APM Terminals BV in 2005 from
SKIL Infrastructure

Deal Rationale
Adani operates major port terminals in Mundra, Hazira, Dahej,
Mormugao and Visakhapatnam. This acquisition cements its
presence on the eastern coast & is in line with its pan-India
strategy, close to the mineral rich states, and steel plants.
Futher, since Dhamra is a harbour outside the control of the
government, Adanis will be free to set their own rates
L&T unlocked its value and improved its consolidated earnings
through this transaction. Soon after its FY13 Q2 results, the
company had told analysts that it will exit from Dhamra Port
by the end of March 2013
Tata Steel was keen to divest this asset owing to its lack of
experience in operating ports. This divestment would help it
raise funds to retire its burgeoning debt

Commentary
Dhamra port acquisition now gives us an opportunity to
The
replicate the development and phenomenal growth of the

Enterprise Value (Rs. Crores)

5,500

EV/ Sales

10.9x

EV/ EBITDA

26.6x

Other Details
The Dhamra port, a deep draft, all weather multi-user port,
commenced operations in May 2011 and handled a total
cargo of 14.3 MTPA in FY14. It is strategically located between
Paradip & Haldia
The port has two fully mechanized existing berths, 63
kilometers of a private rail line connecting the Bhadrak station
to the main trunk line and has already received environmental
clearance for the development of 12 additional berths
Port handles coal, iron ore and other minerals, and expects a
1520% increase in cargo in FY15

Tata Steel has also entered into a long-term cargo handling

arrangement with DPCL assuring 5MT of cargo this year and
this volume will go up every year as its Kalinganagar plant is
ramped up
Following the acquisition, Adanis will invest Rs 7,000 crore
for increasing the number of berths from two to 13 and
expand the capacity to exceed 100 MTPA by 2020

Mundra port on the eastern coast of India and thereby

continue to execute on our pan India strategy
Dilip Shangvi, MD, Sun Pharma

Source: Merger Filings, Company Filings, Press

Infrastructure

10

Sun Pharmas acquisition of Ranbaxy

Deal Overview and Structure

Deal Rationale

On April 7th, 2014, Sun Pharmaceutical announced merger

with Ranbaxy in exchange ratio of 0.8:1 whereby each
Ranbaxy shareholder will receive 0.8 share of Sun Pharma
Daiichi Sankyo will become the 2nd largest shareholder in Sun
Pharma post the deal closure (owning ~9% of Sun Pharma)
The exchange ratio represents an implied value of 457 for
each Ranbaxy share, a premium of 18% to Ranbaxys 30-day
volume-weighted average share price and a premium of 24.3%
to Ranbaxys 60-day VWAP share price, in each case, as of the
close of business on April 4, 2014
Daiichi Sankyo will to indemnify certain costs and expenses
that may arise from USFDA issues of Ranbaxys Toansa facility
Transaction is expected to close by the end of 2014

Merger will create worlds 5th largest specialty generic

pharma company , largest pharma company in India and
largest Indian pharma company in the US market
Combine Sun Pharmas proven complex product capabilities
with Ranbaxys strong global footprint
Expected to generate US$250m revenue and operating
synergies by 3rd year post closure generated from topline
growth, efficient procurement and supply chain efficiencies
Combined entity will have leadership position in 13 specialty
segments and generic products marketed globally, including
629 ANDAs and operations in 65 countries with 47
manufacturing facilities across 5 continents
Expected to be cash EPS accretive within first 12 months of
close

Proforma Revenue Mix

RoW
17%
India
23%

US
60%

Sun Pharma
US$2.5bn (FY2013)

RoW
50%

US
29%

India
21%

Ranbaxy
US$1.8bn (FY2013)

RoW
31%

US
47%

India
22%

Merged Entity Revenue:

US$4.3bn (FY2013)

Source: Merger Filings, Company Filings, Press

Pharma

11

Sun Pharmas acquisition of Ranbaxy; Contd

Deal Financials and Multiples

Updates

Equity Value (Rs. crores)

19,371.1

Enterprise Value (Rs. crores)

24,087.6

EV/Sales

2.27x

EV/EBITDA

29.23x

P/BV

5.53x

Other Details
Daiichi bought 63.92% in Ranbaxy in 2008 for $4.6 billion
Problems started after this: warning letters, import bans, a
consent decree and a $500 million settlement with U.S.
authorities
After years of struggling to turnaround Ranbaxy, Daiichis sale
price implies that its somewhat of a distress sale and Sun
Pharma has got the better side of the bargain

Sun Pharma is looking to turnaround Ranbaxy by FY19 end.

Focus would be on increasing Ranbaxys margins to 1516%
In the 1st year after merger, Sun plans to derive
synergies on the corporate front, SG&A and R&D
In the 2nd year, the focus will be on generating revenue
growth, deriving field force and R&D productivity
Focus will be on enhancing productivity of medical
representatives, cross selling of its products and
leverage the 184 ANDAs that are awaiting approvals
and expanding export markets
By 4th year, Sun Pharma expects to launch products
using Ranbaxy Infrastructure in key emerging markets
Till October 2014, transaction received approvals from
NSE, BSE and anti-competition agencies in applicable
markets excluding India and the US

Commentary
has a significant presence in the Indian pharma
Ranbaxy
market and in the US where it offers a broad portfolio of

believe this transaction brings significant value to all

We
Ranbaxy shareholders. Sun Pharma has a proven track

ANDAs and first-to-file opportunities. In high-growth

emerging markets, it provides a strong platform which is
highly complementary to Sun Pharmas strengths. We see
tremendous growth opportunities and are excited with the
prospects to create lasting value for both our shareholders
through a successful combination of our franchises.
Dilip Shangvi, MD, Sun Pharma

record of creating significant long-term shareholder value

and successfully integrating acquisitions into its growing
portfolio of assets. We are confident that Sun Pharma is the
ideal partner to help us realize our full potential and are
excited to participate in future value creation opportunities.
Arun Sahwney, MD and CEO, Ranbaxy

Source: Merger Filings, Company Filings, Press

Pharma

12

Comcasts acquisition of Time Warner Cable

Deal Overview and Structure:

Deal Rationale

On February 13th, 2014, Comcast and Time Warner Cable, the

top two cable TV companies in USA, reached an agreement to
merge through a friendly, stock-for-stock transaction in which
Comcast will acquire 100% of Time Warner Cables 284.9
million shares outstanding for shares of CMCSA amounting to
~$45.2 billion in equity value

Unique opportunity to create a world class consumer and

enterprise company

The price amounts to $158.82 per share for TWC

Tax free to TWC shareholders who would be owning 23% of
Comcast equity after the deal
Comcast also intends to expand its stock buyback program by
an additional $10bn at the close of the transaction.
In this process, Comcast will net approximately 8 million of
TWCs managed subscribers. This will bring Comcasts
managed subscriber total to ~30million

Extends Comcasts operating capabilities, scale and

technology into new attractive markets
Access to premier markets, including Los Angeles,
New York and Dallas
Enhances the provision of more comprehensive residential
and enterprise services, improving Comcasts ability to
develop new products and better compete regionally and
nationally
Extends the benefits of scale and innovation and brings
technologically superior video and high speed data platforms
to TWC customers and bring certain new TWC
product/service offerings to Comcast customers

Comcast is the Perfect Partner for TWC

Customers will benefit from scale
Accelerate new services to residential customers
Position the company to better compete against much larger competitors in Business services
Advertisers can reach customers more efficiently
Comcast is a stable, well-capitalized partner
A3 rated Balance sheet
Shared commitment to maintaining a strong balance sheet
Track record of consistently returning capital to shareholders
The valuation is fair
The 7.9x headline multiple excludes operating efficiencies and reflects the one-of-a-kind nature of TWCs assets and is
consistent with precedent transactions
Source: Merger Filings, Company Filings, Press

Media

13

Comcasts acquisition of Time Warner Cable

Deal Financials and Multiples

Updates

Offer Price for TWC share = $158.82

May 18, 2014 - The U.S. Federal Communications Commission

(FCC) paused its informal "shot clock" deadline on the review
of the proposed mergers of Comcast Corp (CMCSA.O) and
Time Warner Cable Inc. (TWC.N) over the issue of confidential
programming agreements.

No. of TWC diluted shares = 284.9 MM

Equity Value = $45.2Bn

Net Debt = $24.5Bn
Enterprise Value = $69.7Bn
Implied multiple of 7.9x 2014E EBITDA
Implied multiple of 6.7x EBITDA including operating
efficiencies
Yields double-digit cash-on-cash IRRs
Accretive to FCF per share within Year 1
Substantial revenue growth opportunities

October 9, 2014 - Time Warner Cable Inc. (TWC) investors

voted in favour of the companys $45.2 billion sale to Comcast
Corp. (CMCSA), leaving approval from regulators as the last
major hurdles to combining the largest U.S. cable providers.
November 18, 2014 - President Obamas recent comment on
net neutrality will hurt the prospects of the Comcast deal with
Time Warner Cable in gaining regulatory approval, and it
could also make the deal a lot less attractive to Comcast.

Tweets and Opinions

The deal is said to give Comcast control of more than a third of the U.S. pay-TV market and more than half of the U.S. triple-play
market for video, voice and Internet service, giving it an unprecedented market power over consumers and an unprecedented
ability to exert its influence over any channels or businesses that want to reach Comcasts customers - Anonymous
Commentators keep saying Comcast / Time Warner Cable don't compete. True in cable, but the danger is Comcast becoming an
Internet monopoly John C Abell
Comcast and TWC arent competitors. Its not good to consolidate ownership, but it doesnt reduce choice. They were already cartel
partners Glenn Feishman
This is just an outgrowth of the FCC's failure to foster local competition years ago. That battle lost, we ended up with regional
monopolies Eugene Wei
To me, apparent lack of break-up fee suggests that Comcast/TWC think there is a good chance of regulatory failure Dan Primack
Source: Merger Filings, Company Filings, Press

Media

14

Groupe Lactalis acquires Tirumala Milk

Deal Overview and Structure

Deal Financials and Multiples

On January 7th , 2014, Groupe Lactalis announced acquisition

of 100% of Hyderabad-based Tirumala Milk Products for an
estimated value of $275 million (Rs. 1,750 crore)
Lactalis acquired 74% stake held by Tirumala Milks founders
& 26% stake held by private equity firm Carlyle Group
The deal marks the largest dairy transaction in India
Carlyle's Growth Fund invested Rs 100 crore ($22m) in
Tirumala Milk in 2010 . It will make a three-fold return with a
net profit of $50m through this sale

Equity Value (Rs. crores)

1,750

Enterprise Value (Rs. crores)

1,750

EV/Sales

1.23x

P/E

25.0x

Deal Rationale
Gives Lactalis entry into the world's largest dairy market,
accounting for 20% of the global dairy market which produces
123 million tonnes of milk every year
The current size of the dairy industry in India is Rs.
60,000 crore & is expected to grow at a CAGR of 13-15%
till 2019-20
Will help Lactalis in reducing its reliance on Europe from
where it gets 61% of its revenue
Lactalis will expand the company in North and South India

Commentary
deal marks the largest dairy transaction in India. Tirumala
The
provides a strong platform for Lactalis entry into one of the
largest dairy markets globally. Its been a pleasure to have
worked with both Tirumala and Carlyle on this deal
Jaideep Khanna
CEO & Country Head for Barclays India

Other Details
Groupe Lactalis is the world's largest dairy group with a
turnover of 16bn (Rs. 1.33 lakh crore)
Tirumala Milk is the second-largest milk supplier in south
India with Rs.1,424 crore in sales in the last fiscal year
It is establishing a 20,000 animal farm with an investment of
Rs. 6,000 crore over the next 5 years and has acquired 3,000
acres of land in Andhra Pradesh for the project is already
complete

Commentary
has emerged as a leader in the private sector dairy
Tirumala
market in South India. This was possible due to the relentless
efforts of the founders and the consistent focus on quality. We
are extremely happy to have partnered with Carlyle, who
provided numerous value creation activities and acted as a
catalyst in the growth of the company over the past few years.
Tirumala is the partner of choice for Lactalis, and is well poised
to emerge as a national brand with market leadership position
D. Brahmanandam
Co-Founder & Managing Director of Tirumala

Source: Press

Food & Beverage

15