scorecardresearch
Friday, March 29, 2024
Support Our Journalism
HomeEconomyModi govt is taking the bull by the horn, says Kumar Mangalam...

Modi govt is taking the bull by the horn, says Kumar Mangalam Birla

Follow Us :
Text Size:

Birla’s hunger for deals comes from his optimism about India’s economy, which he likened to an elephant that’s starting to run.

Mumbai: Kumar Mangalam Birla, the billionaire chairman of the acquisitive Indian conglomerate that bears his name, said he’s hungry for more deals after creating the nation’s biggest mobile-phone operator.

His Aditya Birla Group continues to look for targets in the U.S., Europe and India that make business sense and are likely to add value, the 51-year-old said at Bloomberg’s India Economic Forum on 18 September in Mumbai. He didn’t specify any names.

Birla, who runs a $44 billion conglomerate that sells everything from insulators to insurance, helps illustrate India’s emergence as a mergers-and-acquisitions powerhouse, with transactions involving local companies setting records by exceeding $100 billion this year — a trend that PwC India predicts will continue in 2019. One main driver: banks are tackling bad loans by putting companies owned by defaulters on the block.

That’s because the nation’s central bank is pushing local lenders to restructure an estimated $49.3 billion of soured loans in the wake of a new bankruptcy law implemented by Prime Minister Narendra Modi’s administration.

“This government is starting to address it and taking the bull by the horns,” Birla said. “Bad loans have been around for a long time and just got brushed under the carpet.”

Though he didn’t name targets, Birla’s track record indicates he won’t just be spectating the expected flood of assets that will be put up for sale.

His companies have carried out scores of deals, with recent one being Birla’s Idea Cellular Ltd.’s merger with the local unit of Vodafone Group Plc to create India’s biggest carrier. In July, his Hindalco Industries Ltd. announced the purchase of Aleris Corp. for about $2.6 billion to tap global automotive metal demand. UltraTech Cement Ltd. is also seeking to buy distressed Binani Cement, though that pursuit is in a legal wrangle.

Part of Birla’s appetite for deals is because of his optimism about India’s economy, which he likened to an elephant that’s starting to run. Gross domestic product grew 8.2 percent in the June quarter from a year earlier, the government said last month.

“You can’t ignore India,” Birla said. “There’s no legitimate reason for not investing in India.”-Bloomberg

Subscribe to our channels on YouTube, Telegram & WhatsApp

Support Our Journalism

India needs fair, non-hyphenated and questioning journalism, packed with on-ground reporting. ThePrint – with exceptional reporters, columnists and editors – is doing just that.

Sustaining this needs support from wonderful readers like you.

Whether you live in India or overseas, you can take a paid subscription by clicking here.

Support Our Journalism

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular