Journal Press India^®

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Mergers & Acquisitions (M&A) are a significant form of business strategy today for Indian Corporates. A large number of Mergers & Acquisitions deals are making headlines all over the world. One may wonder as to what it is that necessitates Mergers& Acquisitions deals. One may be interested in knowing the main deals of the same and motives behind it. An M&A is a transaction involving two or more corporations, swapping stocks, but only acquiring firm survives. M&A refers to a combination of two or more firms into one firm; it may involve acquisition or consolidation. In absorption, one firm acquires one or more other firms. In consolidation, two or more firms combine to form a new entity. The Indian banking sector reforms initiated in the year 1992 with deregulation of banking sector in India. The Government of India, the owner of public sector banks, has expressed its concern for strengthening these banks through selective M&A in Indian Banking sector. Indian Banking sector will have to explore inorganic growth options in order to ‘Significant’ challenges emanating from large sized foreign banks to be known for their advanced technology and skilled personnel. M&A activities in banking sector have started greatly after 2003 when the heat of competition mounted and the Basel II norms were implemented. Basel II norm, which requires banks to maintain a minimum of 9% Capital Adequacy Ratio (CAR), forced the banking sector to look for consolidation of smaller and weaker banks with larger banks. In article highlighting the M&A and its legal formalities required for M&A in Indian Banking Sector.

Keywords

Mergers; Acquisitions; Banks Consolidation & Legal Issues

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