MLEs in Malaysia increase M&A volumes for strategic growth

MLEs in the BRIC economies (Brazil, Russia, India and China) are among those leading the way with 44% of respondents considering an acquisition, compared to 27% in 2010. Driven by the desire to access new markets and acquire new technology or established brands, 45% of businesses in mainland China plan to grow through acquisition, an increase of 19% over 2010.    

Likewise, Indian companies, which are well experienced in dealing with overseas M&A markets, are now back on the acquisition trail, with 40% of those planning an acquisition in the next three years expecting their deals to be cross border.

Mahad Narayanamoni, M&A partner with Grant Thornton India, believes this reflects a coming of age for Indian businesses: "Indian companies are now more experienced in dealing with overseas M&A transactions and are considered serious contenders for acquiring global businesses.  Acquiring global brands, gaining access to overseas markets and leveraging new technologies for Indian markets are some of the key drivers for outbound acquisitions by Indian companies."

An increase in planned M&A activity is also reflected in the results from the other major regions (see figure 1). For example, in North America, 41% of the region’s MLEs are planning acquisitions. Stephen McGee, national practice leader of corporate finance at Grant Thornton US, explains: "After two slow years, with an improving economy and easing credit market, there is considerable pent-up demand for acquisitions."

 

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For further information please contact:
Sharon Sung
Director, Technical & Corporate Affairs
T +603 2692 4022
E sharonsung@gt.com.my

Notes to editors

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SJ Grant Thornton is a member firm of Grant Thornton International Ltd and provides assurance, tax, corporate finance, restructuring and other specialist services to private and public listed companies. With four offices across Malaysia – Kuala Lumpur, Penang, Johor Bahru and Kuantan, and access to more than 2600 partners in over 100 countries worldwide, we have invaluable local expertise supported by global reach.

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Data collection

The research is carried out primarily by telephone interview lasting approximately 15 minutes with the exception of Japan (postal), Philippines and Armenia (face to face), mainland China and India (mixture of face-to-face and telephone) where cultural differences dictate a tailored approach. Telephone interviews enable Grant Thornton International to conduct the exact number of recommended interviews and to be certain that the most appropriate individuals are interviewed in an organisation which meets the profile criteria.

Data collection is managed by Grant Thornton International's core research partner - Experian Business Strategies. Questionnaires are translated into local languages with each participating country having the option to ask a small number of country specific questions in addition to the core questionnaire. Q4-2010 fieldwork took place in November/December 2010.

Sample

IBR is a survey of medium to large privately held businesses, researching the opinions of over 5,700 businesses in Q42010, and over 11,000 on an annual basis. The target respondents are chief executive officers, managing directors, chairmen or other senior executives (title dependent on what is most appropriate for the individual country) from 39 economies primarily across five industries: manufacturing (25 per cent), services (25 per cent), retail (15 per cent and construction (ten per cent) with the remaining 25 per cent spread across all industries.
Locally, the sample tends to cover the industries mentioned previously, with some countries being able to have local valid data for specific sectors or regions when the sample size is large enough.