PE deals plunge 39% in Jan-March quarter

Private equity deal activities in the first quarter of 2013 fell by 39 per cent to $1.29 billion, amid a sluggish global and domestic economic environment, says a report.

According to audit and advisory firm Grant Thornton, PE deals worth $1.29 billion were announced in the first three months of 2013, down from $2.13 billion in the same period of last year.

"The quarter clearly saw decline in deal activity, possibly driven by interplay of factors given the macro conditions (global economic weaknesses along with slowness in growth in Indian economy), as well as the pressure on liquidity," Grant Thornton said in a report.

Commenting on the findings, Grant Thornton India Partner (Transaction Advisory Services) Raja Lahiri said, "As far as private equity is concerned, we could expect moderation in overall deal activity."

Lahiri further said that pressure on PE funds to exit might, however, push the deal momentum higher going forward.

During the January-March quarter of 2013, there were a total of 90 deals -- marking a year-on-year decline of 26 per cent.

Demonstrating PE interest in renewable energy sector, the largest PE deal during the quarter was that of Government of Singapore Investment Corporation's $150 million investment in Greenko.

A sector-wise analysis shows that pharma, healthcare and bio-tech cornered the lion's share (22 per cent) in PE deals in the first quarter of this year, followed by power and energy (15 per cent), real estate and banking (13 per cent each) and ITeS and cement (8 per cent each).