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BHEL scouting for consultants to revive M&A business

NEW DELHI: Bracing up for international foray and competition, Bharat Heavy Electricals Limited (BHEL) is scouting for global advisors and consultants for reviving its dedicated unit for overseas mergers and acquisitions (M&A) business.

The company is also on the verge of inking a memorandum of understanding (MoU) with ILFS for promoting exports. “Everything has been put in place and hopefully the MoU would be inked soon. BHEL has great potential in African countries, West Asia and Southeast Asia. If this is supported by attractive financial backing, BHEL could achieve major breakthroughs in the international market,” Minister of State for Power and Commerce, Jairam Ramesh, said.

Mr. Jairam Ramesh said that BHEL was in talks with various global advisors such as PriceWaterhouse Coopers, Ernst and Young, and KPMG for the appointment of a consultant for the M&A unit. Although, it was too early to talk about what actually the company planned, it had on its mind to zero in on small and medium-sized companies abroad, he added.

BHEL had a separate unit for this purpose earlier but it failed to make an acquisition. Officials in BHEL said that the company faced territorial restrictions because of its collaborations with global players like GE and Siemens and that was the reason why it had decided to go whole hog on M&A as it would provide the leverage to explore the global markets.

The separate business unit will be a centralised group based in New Delhi which will work in tandem with the selected global consultant. It will be a focussed group that will take care of due diligence and other M&A procedures. BHEL will also focus on acquiring new technologies, market access and product development.

It is not just the power equipment business, the company is also looking at companies in the rigs business and defence equipment.

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