Merger & Acquisition
Evolving Landscape of Power Sector in India
Indian power sector is charged up with high M&A deals recently as lenders nudge beleaguered power plant owners to lower valuation expectations for their projects. Foreign investors are keen to pick up more projects as the M&A gives them easy entry into the sector and valuations are attractive. Most of the power plants currently are caught between high debt and poor cash flow.
Modes of M&A
Acquisition
It can either be in the form of share purchase, whereby controlling interest in the target is acquired, or it could be in the form of acquisition of a business undertaking.
Mergers
A merger is a combination of one company into another, whereby the transferor company loses its existence upon merger with the transferee company.
Joint Venture (JV)
Its a form of business arrangement whereby two or more companies having different capabilities or expertise come together to undertake a business venture