NEW DELHI: Despite the Covid-19 pandemic, values of private equity (PE) investments and merger & acquisitions (M&A) have witnessed an annual growth of seven per cent in 2020 to little over $80 billion as compared to $74.8 billion in the previous year.
Strategic deals or M&A accounted for over 50 per cent of the total deal value, while PE activity kept pace with last year, recording investments worth $38.2 billion, according to a latest PwC report. About 25 per cent of this deal value is attributed to inbound investments in Reliance Jio Platforms. Facebook invested around $ 5.7 billion in Jio Platforms for nearly a 10 per cent stake – possibly one of the largest deals to be completed during the lockdown.
This was followed by a $ 4.5 billion investment from Google for a 7.7 per stake in Jio Platform. Reliance Retail Ventures’ acquisition of Future Group for $3.3 billion was the largest domestic deal recorded in 2020. In total, 2020 recorded 17 deals in the billion-dollar bracket, nearly double the number of such deals (nine) recorded in 2019.
Sector wise, telecom replaced technology in the top position by attracting investments worth $11.2 billion. Retail was also a new entrant, attracting investments worth $ 6.5 billion. The report added due to Covid-19 led disruption the investment community expects bad loans to spike again creating a very lucrative opportunity. “In the interest of recovery, it is very likely that good-quality assets will be made available at attractive valuations, driving more funds,” it added.