Mergers & Acquisitions Services in India

Reviewed by Devendra Kumar Malhotra, IBBI Registered Valuer | Sapient Services Pvt. Ltd., New Delhi

An M&A transaction in India runs through valuation, financial and tax due diligence, deal structuring, and — depending on the structure and the parties — CCI clearance, SEBI compliance, NCLT approval, and FEMA rules. Which of these apply, and in what sequence, is decided by the transaction structure and by whether the target is listed.

Sapient Services Pvt. Ltd. advises on mergers and acquisitions across India from our base in New Delhi, working with promoters, PE sponsors, strategic buyers, and family businesses on domestic and cross-border deals. Our scope runs from valuation through NCLT filings, CCI approvals, FEMA compliance, and post-merger integration, and we coordinate alongside a client’s own legal, tax, and audit advisors rather than replacing them. The practice has run for 35+ years and completed 500+ valuation assignments.

At a Glance

What Is M&A Advisory?

M&A advisory is professional guidance on structuring, valuing, and closing a merger, acquisition, demerger, or slump sale in compliance with Indian company, securities, competition, and tax law — the Companies Act 2013, the Competition Act 2002, SEBI regulations, FEMA, and the Income Tax Act, each with its own process and timeline. Sapient advises across this full path rather than on valuation or filings in isolation.

Who Needs M&A Advisory Services in India?

• Promoters planning a full or partial exit — need an independent valuation and buyer identification.
• PE sponsors and strategic buyers assessing a target — need financial, tax, and technical due diligence.
• Groups consolidating subsidiaries, or exploring a joint venture or strategic alliance instead of an outright acquisition, via merger, NCLT scheme, or Section 233 fast-track.
• Foreign acquirers and Indian companies in cross-border deals — need FEMA pricing compliance and RBI approvals.
• Listed companies and acquirers triggering SEBI’s open offer requirement under Regulation 8.
• IBC resolution applicants and CIRP participants — need IBBI-compliant fair and liquidation valuations.

Key 2026 Regulatory Updates Every Deal Must Account For

• Section 233 Fast Track Merger expanded — MCA Notification G.S.R. 603(E), 4 September 2025. Unlisted companies (borrowings ≤ ₹200 Cr, no default), holdco-subsidiary and fellow-subsidiary combinations, and inbound cross-border reverse flips now bypass NCLT via Regional Director in 60 days. Demergers are now procedurally eligible too — but see tax note below.
• CCI Deal Value Threshold (DVT) operative from 10 September 2024 — Section 5(d), Competition (Amendment) Act 2023. Deals above ₹2,000 crore where the target has Substantial Business Operations in India need mandatory pre-notification, alongside the existing asset/turnover thresholds. Phase I: 30 working days (deemed approved if no prima facie view forms). Overall statutory limit: 150 days.
• Income Tax Act 2025 (effective 1 April 2026, Act No. 30 of 2025) — Section 70 covers transactions not regarded as transfer (demerger exemptions). Section 77 governs slump sale capital gains. Sections 116 and 117 govern amalgamation loss carry-forward — for amalgamations from 1 April 2025 onward, the successor can carry forward losses only for the balance of the predecessor’s original 8-year window, not a fresh 8 years.
• Corporate Laws (Amendment) Bill, 2026 — pending, not yet law. Introduced in the Lok Sabha on 23 March 2026, currently with a Joint Parliamentary Committee (report submitted 3 August 2026). If enacted, it would move Section 230–233 scheme filings to a single NCLT bench and cut the fast-track merger creditor-approval threshold from 90% to 75%. Plan deals on the current framework until it is notified.
• RBI now permits bank-funded acquisitions — effective 1 July 2026, eligible companies can borrow from banks to fund up to 75% of an acquisition’s value for equity or CCDs in a target company, subject to RBI eligibility, exposure, leverage, and other prudential conditions. This financing route did not exist in India before 2026.

Deal Structures Under Indian Law

Choosing the wrong structure early is expensive to fix after signing. Most mergers and demergers proceed as a scheme of arrangement under Sections 230–232; the table maps each route to its regulatory path and timeline.

Our M&A Advisory Services in India

1. Business Valuation for Deal Pricing

Our IBBI-registered valuers use DCF, Comparable Company Analysis, Precedent Transaction Method, and NAV, with methodology documented for NCLT, SEBI, FEMA, and CCI requirements. For applicable listed-company schemes, this valuation supports the share-exchange ratio; a separate fairness opinion from a SEBI-registered merchant banker may also be required — the two are distinct documents with distinct signatories. Where a registered valuation is required by law, a non-IBBI-registered report risks objections or being treated as incomplete.

2. Financial, Tax, and Technical Due Diligence

Financial DD covers quality of earnings, adjusted EBITDA, working capital, and debt schedule. Tax DD reviews income-tax exposure, GST compliance, transfer pricing, and pending litigation, pricing transaction tax risk into the deal before signing. Technical DD, via our Chartered Engineering team, adds physical verification of plant and machinery — a workstream financial DD does not cover on its own, and useful wherever the target is asset-intensive.

3. NCLT Scheme of Arrangement — Sections 230–232

We coordinate the Scheme document, company petitions, IBBI-registered valuation reports, class meetings, and post-sanction ROC filings. Standard NCLT timeline: 12–18 months.

4. Fast Track Merger — Section 233 (September 2025)

Eligible companies can use the Regional Director route instead of NCLT. The statutory process runs 60 days, though actual completion depends on the scheme, objections raised, and how quickly required filings are cleared. Sapient assesses eligibility, prepares the Scheme, files all CAA-series forms, coordinates the auditor’s certificate on the debt threshold, and manages the RD process.

5. CCI Combination Filing

Sapient assesses DVT and asset/turnover-threshold applicability before any public announcement, drafts CCI Form I or Form II, manages information requests, and sequences deal steps to prevent gun-jumping under Section 43A. Phase I: 30 working days, subject to information-request exclusions. Overall statutory limit: 150 days.

6. SEBI Open Offer Compliance

Crossing 25% voting rights in a listed company, or acquiring control regardless of shareholding, generally triggers a mandatory open offer for at least 26% of the target’s total shares, subject to SAST exemptions. Sapient handles the Regulation 8 pricing analysis, merchant banker coordination, and the filings around it — an incorrectly priced offer can force a SEBI-mandated revision that delays the transaction.

7. FEMA and Cross-Border M&A

FEMA pricing compliance, Form FCGPR and FCTRS filings on the RBI FIRMS portal, and sector regulator coordination — RBI (banking/NBFCs), IRDAI (insurance), TRAI (telecom). Pricing violations trigger RBI compounding proceedings.

8. Post-Merger Integration

Day One readiness starts before closing: financial reporting alignment, asset register reconciliation, and compliance audit for the merged entity are mapped during structuring, not after. Our Chartered Engineering team verifies transferred assets post-close — most useful for manufacturing and infrastructure deals, where the asset register is often the first thing that goes wrong.

How an Engagement Works

Advisory Fees

M&A advisory fees depend on transaction structure, valuation scope, due diligence requirements, the regulatory filings involved, and the level of closing or integration support needed. Sapient prices engagements on scope rather than as a percentage of deal value, and provides a proposal after an initial, no-charge consultation on the transaction.

Why Companies Choose Sapient

Common Mistakes to Avoid in an Indian M&A Transaction

• Using a non-IBBI-registered valuer where the law requires a Registered Valuer — NCLT, SEBI, and IBC filings can treat the valuation as incomplete.
• Running the CCI Deal Value Threshold check only after the SPA is signed. Closing before approval is gun-jumping under Section 43A — the CCI has penalised parties for it before, including NTPC and Massachusetts Mutual Life Insurance.
• Choosing Section 233 fast-track for a demerger without checking tax neutrality — it isn’t extended to fast-track demergers; only the NCLT route under Sections 230–232 qualifies.
• Assuming a merger resets the loss carry-forward clock to a fresh 8 years — Section 116 caps it at the balance of the predecessor’s original window.
• Relying on financial due diligence alone on an asset-heavy target, which misses the physical condition of plant and machinery.

Frequently Asked Questions

Q1. Merger vs acquisition — what is the legal difference in India?

A merger (amalgamation) absorbs one company into another; the transferor ceases to exist. An acquisition purchases a controlling stake, and the target continues as a subsidiary. Mergers require NCLT approval (Sections 230–232) or Regional Director approval (Section 233 Fast Track). Acquisitions are governed by contract law, the SEBI Takeover Code for listed targets, and the Competition Act, with FEMA requirements for cross-border deals.

Q2. When is CCI approval mandatory?

CCI pre-notification is required when a transaction crosses the Competition Act’s asset or turnover thresholds. Since 10 September 2024, the Deal Value Threshold under Section 5(d) applies alongside those — deals above ₹2,000 crore where the target has Substantial Business Operations in India need mandatory filing even if the target is below the asset/turnover de minimis limits. The CCI has 30 working days to form a prima facie view (deemed approved if it doesn’t), and the overall statutory limit is 150 days.

Q3. Who qualifies for the Fast Track Merger route after September 2025?

MCA Notification G.S.R. 603(E), 4 September 2025, extended eligibility to small companies, startups, unlisted companies with borrowings ≤ ₹200 crore and no payment default, holding-subsidiary and fellow-subsidiary combinations, and foreign holding companies merging into Indian wholly owned subsidiaries. Demergers are now procedurally eligible, but do not qualify for tax neutrality under the IT Act 2025. Listed transferor companies remain excluded.

Q4. What triggers a mandatory SEBI open offer?

Crossing the 25% voting-rights threshold in a listed company, or acquiring control regardless of shareholding, generally triggers a mandatory open offer for at least 26% of the target’s total shares, subject to the applicable SAST exemptions. The minimum price under Regulation 8 is set from prescribed parameters — negotiated price, acquisition prices over specified look-back periods, and the 60-trading-day VWAP for frequently traded shares. A SEBI-registered merchant banker must be appointed before the public announcement.

Q5. How is a slump sale taxed under the Income Tax Act 2025?

Section 77 (effective 1 April 2026, replacing Section 50B of the 1961 Act) taxes the gain as the fair market value of the undertaking — computed under Rule 53 as the higher of an asset-based figure or a consideration-based figure — minus net worth. It’s long-term if held more than 36 months, and an accountant’s report in Form No. 28 must go with the return. Contractual liabilities aren’t automatically excluded; assignment rights and change-of-control clauses need reviewing contract by contract.

Q6. What is the role of an IBBI-registered valuer in M&A?

Where the applicable law requires a Registered Valuer, the valuation must come from a professional holding the relevant IBBI registration and asset-class authority — the share exchange ratio in NCLT schemes, infrequently traded shares in SEBI open offers, and fair/liquidation value in IBC CIRP (Regulation 35) all fall under this. Sapient’s valuers are registered under the SFA and Plant & Machinery asset classes.

Q7. How long does a merger or acquisition take in India?

It depends on the structure, not a single number. Fast Track Merger: a 60-day statutory window, though actual completion varies. NCLT merger: 12–18 months. Share acquisition without a CCI trigger: 30–60 days. CCI Phase I: 30 working days. Open offer: roughly 60–90 days, PA to settlement. Cross-border deals needing RBI approval: add 4–8 weeks.

Q8. What does M&A advisory cost in India?

It depends on transaction structure, valuation scope, due diligence requirements, and which regulatory filings apply — Sapient prices engagements on scope rather than as a percentage of deal value, and gives a proposal after a no-charge initial consultation.

Q9. What is a scheme of arrangement under Indian company law?

A scheme of arrangement is a court- or tribunal-sanctioned restructuring under Sections 230–232, used for mergers, demergers, and compromises with creditors or members. It requires NCLT approval, class meetings of affected shareholders and creditors, and a valuation report from a registered valuer. The Fast Track route under Section 233 covers a narrower set of eligible schemes through the Regional Director instead.

Q10. Is the Corporate Laws (Amendment) Bill, 2026 already in force?

No. The Bill (No. 85 of 2026) was introduced in the Lok Sabha on 23 March 2026 and is currently with a Joint Parliamentary Committee, which submitted its report on 3 August 2026. Until it is notified, deals should follow the current framework, including the existing multi-bench NCLT filing requirement and 90% creditor-approval threshold for fast-track mergers.

Q11. Can Indian banks fund an acquisition directly?

Yes, since 1 July 2026. Under the RBI’s revised capital market exposure directions, eligible companies can borrow from banks to fund up to 75% of the value of an acquisition of equity shares or CCDs in a target company, subject to RBI eligibility, exposure, leverage, security, and other prudential conditions. Before this, Indian banks could not lend against shares for acquisition purposes, so buyers relied on NBFCs, overseas lenders, or promoter equity.

Work With Sapient Services

If you’re planning an exit, evaluating a target, or consolidating group subsidiaries, the regulatory path is worth mapping before the first deal step, not after a term sheet is signed. Sapient has run this practice for 35+ years and completed 500+ valuation assignments pan-India, working from our New Delhi base.

Disclaimer: This content is for general informational purposes only and does not constitute legal, tax, or regulatory advice. Regulatory positions are subject to change — professional guidance should be obtained before acting on any information here.