Now Reading: SBI eyes 20% of ₹2 trillion M&A market with 5-6 deals
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SBI eyes 20% of ₹2 trillion M&A market with 5-6 deals
State Bank of India has five to six merger and acquisition financing deals in its pipeline, having already closed four to five deals this year including a large one, a senior official…
The Story in Brief
State Bank of India has five to six merger and acquisition financing deals in its pipeline, having already closed four to five deals this year including a large one, a senior official said. The bank sees an aspirational 20% share of the roughly ₹2 trillion M&A financing market, opened up by the RBI in April when it allowed banks to fund up to 75% of acquisition values for both listed and unlisted companies.
SBI recently joined a consortium of 11 global lenders to finance Sun Pharma’s $11.75 billion acquisition of New Jersey-based Organon, becoming the only Indian bank in the group. The official said the acquisition brought Sun Pharma as a new client. SBI’s gross advances rose 19% year-on-year to ₹50 trillion in June, with domestic corporate advances up 18% to ₹14 trillion.
The Indian Opinion
Two narratives are struggling for airtime: one that Indian state banks are too cautious to chase M&A financing, and another that they cannot price competitively against global lenders. SBI’s Sun Pharma deal, where it was the only Indian bank in an 11-lender consortium, punctures the first. The second will be tested as SBI scales up. The real question is whether it can win business without underpricing risk. Watch for the pricing spreads on its next few transactions.
Source: livemint.com
This story was synthesised by AI from the source linked above.
