Page 33 - Banking Finance December 2020

ARTICLE

MERGERS AND

ACQUISITION- A

CONCEPTUAL

DELIBERATION IN

INDIAN CONTEXT

Introduction Merger & Acquisition- The Indian
The merger of the three public sector banks- Bank of Baroda, Context
Vijaya Bank and Dena Bank has raised a lot of curiosity There has been a continuous process of consolidations in any
towards consolidation process through mergers like never
evolving market. Once a market is allowed to grow, many
before. The reason being firstly it is directly related to
companies join the bandwagon to take the advantage of
public.
business opportunities, however as the market advances to
maturity, it discards players with irrelevant business model,
All the three banks hold an illustrious history of more than competencies and scaling plans. We may see the Indian
100 years with billions of people as customers in its fold.
mobile network market for example. You could probably
Secondly, while mergers and acquisition in corporate sector
remember the name of many network providers who
is a continuous process, the merger of three public sector
entered in the growing Indian market when India embraced
banks is a major event in banking history in last 50 years wireless communication technology in last decade like-
after the nationalization of banks in 1969.
Ericsson, AT&T, Spice, MTS, Virgin, Reliance (Anil Ambani
endeavor), Tata Teleservices and so on.
About the author
These companies today are nowhere on horizon. As Indian
Rakesh Bhootda mobile network market entered in maturity stage from
CAIIB, MBA growing stage, only fewer players with deep pockets,
Chief Manager & Faculty Member competencies, scaling, technology and eager to serve
Sir Sorabji Pochkhanawala Bankers customers are here to stay, thus now only four players are
Training College left in game i.e. Vodafone, Airtel, Reliance Jio and state
Central Bank of India, Mumbai
sponsored BSNL/MTNL. This is exactly the pattern in mature

BANKING FINANCE | DECEMBER | 2020 | 33