Besides, when it comes to deal-making, the size of Indian companies buying into foreign players continues to get bigger compared to overseas firms acquiring stakes in domestic firms.
The size of outbound deals have grown nearly five times from its level in 2005, while the inbound deals have dropped to the one-fifth of what it stood at two years ago.
According to the latest IT sector M&A data from Grant Thornton, a total of 175 IT and ITeS deals were announced during the first nine months of 2007 with a total value of $3.59 billion. This translates into an average of 1.54 deals in a day or more than three deals in two days.
The 175 deals during January-September period included 120 M&A deals worth $2.54 billion and 55 private equity deals worth $1.05 billion.
There were 75 cross-border deals worth $2.19 billion, a large proportion of which came from the outbound deals at $2.03 billion.
According to Grant Thornton, outbound deals have grown nearly five times to 2.03 billion dollars this year, from $0.40 billion in 2005. In 2006, outbound deals worth $1.37 billion were announced.
At the same time, the size of inbound deals have dropped to $0.16 billion this year, which is less than one-fifth of $0.85 billion in 2005. In 2006, the Indian IT space witnessed inbound deals worth $0.69 billion.
The biggest overseas acquisition by an Indian IT company so far this year is Wipro's takeover of Infocrossing Inc along with subsidiaries in the US for $600 million. This is followed by Firstsource Solutions' acquisition of MedAssist Holdings in the US for $330 billion.
The number of deals by Indian companies so far this year is 57, which is more than triple the number of deals by international companies here (18). In terms of deal size, outbound deals were ten times more than that of inbound deals.
"Indian companies are acquiring more and more international companies to get a global footprint and to expand their presence internationally," Grant Thornton said.
The largest proportion of outbound deals were made in North American, which contributed 82 per cent of the total outbound deals, with the US alone accounting for 75 per cent.
In inbound deals, Europe contributed for 59 per cent of the deal value, followed by North America (40 per cent) and Asia at one per cent.
Indian IT companies have invested the most in the US with 33 deals worth 1.53 billion dollars, followed by Canada with four deals worth $166 billion.
The number of domestic deals rose to 45 this year, after remaining constant at 25 in 2005 and 2006 each. However, the size of domestic deals has dropped to $0.36 billion this year, after rising considerably to $0.85 billion in 2006 from $0.09 billion in 2005.
