Despite surge, still a long road ahead for start-up M&As in India

Bengaluru: Merger and acquisition activity in India’s start-up ecosystem is increasing, but it will take two to five years more to gain scale. As overall funding for technology start-ups declines, M&A deal value in 2015 went up 70% over 2014 to $1.35 billion across 137 transactions, with a 130% increase in the deal volume compared to 2014, according to a report, India Technology Product M&A Industry Monitor, released by investment banking firm Signal Hill and software products think-tank iSpirt. The largest deal among these is the $900 million acquisition of ad-tech firm Media.net by Chinese firm Miteno Communication Technology, which was also among the largest ad-tech deals globally. “With an increasing number of companies that received funding during the 2014 and 2015 funding boom achieving scale during the next couple of years, we expect Product Tech M&A levels in particular across mid-size and large transactions to pick-up multi-fold from here,” said Klaas Oskam, managing director of Signal Hill India. The funding deal volume in the first three quarters of 2016 was comparable to the same period last year when 250 deals took place, but deal value dropped 54% to $2.4 billion from $5.29 billion.