Heightened risk aversion and financial prudence on the part of investors may drive a revival of joint ventures. Vandana Chatlani investigates the risks and rewards of joint venturing
To many foreign investors, India’s proverbial legal labyrinth is worth navigating to launch or expand their businesses in the country. With billions of dollars of investment pouring into the country each year, multinationals and their legal counsel have become India-savvy and unafraid to employ complex strategies when picking their pawns from India Inc’s chessboard.
For example, France’s Sanofi Pasteur, the vaccines division of the Sanofi-Aventis pharmaceutical group, seized its position in the Indian market last July after taking control of Shantha Biotechnics for US$783 million; Norwegian telecoms giant Telenor acquired a majority stake in Indian mobile services company Unitech Wireless for US$1.2 billion; while United Arab Emirates telecom major Etisalat purchased a 45% stake in India’s Swan Telecom for US$900 million.
Indian corporates are becoming equally bullish with players like Bharti Airtel pioneering the way towards global expansion. The company completed India’s second largest cross-border acquisition, clinching the African assets of Kuwait-based Zain for US$9 billion earlier this year.
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