Valley Chai

i am seeing large foreign m & a transactions pretty much on daily basis, mostly under $200M range. though not limited to IT companies, the software majors are participating in the trend in a huge way. check out the economic times article on what’s fueling the acquisitions.

“One way to look at the rupee impact is that if the currency has become 8% stronger, some of the smaller acquisitions, in effect, have become 8% cheaper.”

add leverage on top of that, and you have a huge purchasing power for these bigs (Wipro, TCS, Infosys, Satyam). so smart it companies would sell more services/software when rupee is weak, and go acquire foreign assets when the rupee is strong. not bad strategy, eh?