1. Mergers & Acquisitions between India and Europe
14:00/15:15- Panel 2
Mergers & Acquisitions between India and Europe

2. Mergers & Acquisitions between India and Europe
14:00/15:15- Panel 2
Mergers & Acquisitions between India and Europe
Chairperson: R. SANKARAN, Advisor, Rothschild India
Sanjay BHANDARKAR, Managing Director, N M Rothschild & Sons (India)
Kalpesh KIKANI, Senior General Manager, ICICI Bank
Tim THOMAS, Chief Operating Officer, Bharti AXA Life Insurance Co.

3. India – Europe Connexion
Sanjay BHANDARKAR Managing Director N M Rothschild & Sons (India)

4. India – An Overview GDP Growth rate amongst the highest in the world
Clocked at 8.4% last year and estimated c.9 % for the current year
5th largest nation in the world in PPP terms (€ 3tn)*
Per Capita GDP (PPP) : € 2,720*
Growth spurt led by manufacturing and service sectors
Highest FII inflow amongst emerging Asian economies in CY06 (€ 6.2bn)
FDI Inflows at € 5.5bn in FY 06 (40% YoY growth)
Among the four fastest developing BRIC economies in the world
Population of over 1bn with 54% less than 25 years old
Note * - As of 2006 est

5. Foreign attractiveness
India – Developed Capital Market
Capital markets
Has one of the most developed capital markets among emerging countries
Only BRIC country with Market Cap. higher than GDP
115 companies with a Market Cap. greater than €1bn (As of 15th May 2007)
Substantial PE interest
Indian corporates have made aggressive cross-border acquisitions backed by
Funding from investors, hedge funds and banks
Government pursuing progressive liberalization and easing of FDI norms
100% FDI allowed in most infrastructure sectors
Source Rothschild analysis
Note Indices rebased to 100
Foreign attractiveness
Source A T Kearney Study 2005

6. Indian Companies Going Abroad
“The Indian Multinational”
A steel company in UK, an oil & gas explorer in Norway, a generic drug manufacturer in Germany; all have one thing in common - they are all flying the Indian tricolor
Value of outbound deals larger than inbound
In Jan-March 2007, 40 out-bound deals with a total value of € 15bn
Led by Tata-Corus, Hindalco-Novelis, Aban-Sinvest
Companies looking to expand their product portfolio, access new markets, technologies
From regional to global player

7. Indian Acquirers – European Targets
Indian companies on a massive acquisition spree in past 2 years
Led by Iron and Steel, Energy and Pharmaceutical sectors
More outbound deals than inbound deals in 2006 in value terms
Largest portion of outbound acquisitions in Europe (42%) followed by North America (24%)
Tata – Corus deal represents largest ever acquisition by an Indian company
Source: Thomson Financial
Note:1) 2007 figures are YTD
2) All completed Deals only

8. Indian Acquirers – European Targets
Sectoral Split
Iron & Steel
Tata’s € 9.5bn acquisition of Corus Group PLC
Energy
Aban Offshore’s € 1.1bn acquisition of Sinvest ASA, an oil & gas E&P company
Suzlon Energy is currently in the process of acquiring German based REpower Systems
Has placed a competitive bid of € 710m
Pharma & Biotech
Dr. Reddy’s € 577m acquisition of German pharma major betapharm GmbH
Ranbaxy Laboratories acquired Romanian based Terapia SA for € 270m
Source: Merger Market, Rothschild analysis
Note:1) Includes all announced deals from 2004 till 2007 YTD
2) Excludes Tata – Corus deal

9. Indian Acquirers – European Targets
Top 10 Deals (2005 – 2007YTD)
Source: SDC, Merger Market, Rothschild analysis

10. European Acquirers – Indian Targets
European investment in India constantly on the rise
Majority of inbound investments seen in Telecom, IT and Financial Services sectors
Vodafone’s recent acquisition of Hutch’s 67% stake in Hutchison Essar
Largest ever acquisition by a foreign company in India
Source: Thomson Financial
Note:1) 2007 figures are YTD
2) All completed Deals only

11. European Acquirers – Indian Targets
Sectoral Split
Telecom
Vodafone’s € 10.5bn announced acquisition of Hutch’s 67% stake in Hutchison Essar
In 2005, Vodafone also picked up 6% stake in Bharti Airtel for € 686m
Mining
UK based Vedanta Resources’ recent announced acquisition of 71% stake in Sesa Goa for € 972m
Cement
Swiss cement major, Holcim picked up 20% stake in Gujarat Ambuja Cement for € 466m
Source: Merger Market, Rothschild analysis
Note:1) Includes all announced deals from 2004 till 2007 YTD
2) Excludes Vodafone – Hutchison Essar deal

12. European Acquirers – Indian Targets
Top 10 Deals (2005 – 2007YTD)
Source: SDC, Merger Market, Rothschild analysis
Note *- Through its Indian Subsidiary, Mysore Breweries

13. In Conclusion Cross border activity on a continuous rise
Number of cross border deals increased from 60 in 2004 to 266 in 2006
A significant proportion of M&A activity (in terms of volume) was done by mid cap companies
Number of Indian companies that are able to do major acquisitions abroad is growing constantly
In the first few months of 2007, Indian M&A crossed € 26bn led by large cap companies like Tata, Suzlon, Hindalco (Birla group)
Easy availability of debt for acquisition financing
Inbound acquisitions constrained by limited availability of high quality companies

14. Rothschild India Office
Advised Tata Steel on € 9.3bn acquisition of Corus Group
Advised Dr Reddy’s € 577m acquisition of betapharm
Advised Azure on € 113m sale to Subex Systems
€ 1.4bn Dabhol power project
Daewoo automobile plant in India
Air Deccan, first Indian LCC
Radio Mirchi, first private FM channel
Radha Krishna Foodland, first food distribution deal
Lanco Amarkantak power project, first coal based IPP in India
2007
Tata Steel
Advised on US$ 11.9bn
acquisition of Corus Group
plc
2006
Dr. Reddy
s Laboratories
Advised on the US$576m
acquisition of Betapharm,
Germany
2006
Azure Solutions
Advised controlling
shareholders on their US$
140m disposal of
shareholding to Subex
Systems through a GDR
issuance
ICICI, IDBI, SBI
US$1.9bn disposal of
assets of Dabhol Power
Company to Ratnagiri Gas
& Power Pvt Ltd (a JV
between NTPC and GAIL)
2005
2005
ICICI IDBI EXIM
Advised Indian Lenders to
Daewoo Motors (India) on
the monetisation of assets
Air Deccan
Raising US$40m private
equity from ICICI Ventures
and Capital International
2005
Entertainment
Network (I) Ltd.
Financial Adviser on fund
raising
2002
2004
Foodland
US$25m private equity
infusion from Warburg
Pincus
Advised on induction of
financial partners in 600
MW coal based
Amarkantak Power Project
2006
Lanco Group

15. Mergers & Acquisitions between India and Europe
14:00/15:15- Panel 2
Mergers & Acquisitions between India and Europe

16. Kalpesh KIKANI Senior General Manager ICICI Bank
India-Europe M&A
Kalpesh KIKANI Senior General Manager ICICI Bank

17. Agenda
M&A activity in India
Trends in Indian outbound M&A
Considerations in European deals

18. Increased corporate activity
Indian corporates aspiring to become market leaders in their business segments not only in India but also globally
Growth drivers
Strong growth in demand leading to increased utilisation of existing capacity
Product portfolio and service offering enhancement
Access to new technology and markets
Derisking the business
…aided by easier access to capital supply…

19. Increased access to capital
Private Equity
Domestic Public issue
ADR/ GDR issue
ECB/ FCCB issue
…reflecting in the sharp increase in M&A activity in the recent past…

20. M&A activity in India
USD billion
Share of India in global market
* 2007 figure is estimated
Source : Bloomberg
Value of Indian deals grew at a CAGR of 140 % from USD 8.3 bn in CY04 to USD 47.4 bn in CY06
ICICI Bank was involved in USD 16.5 billion worth of deals in CY06
Outbound M&A deals till March was USD 8.8 billion in 2007
Estimated total outbound M&A projected to be more than USD 35.0 bn in 2007
This appears to be just the beginning of the M&A wave in India

21. India-Europe M&A
Europe represents the region with the largest number of acquisitions from India
India’s share of outbound deals originating from Western Europe has increased from 5.0% to 8.5% between CY04 and CY06
In value terms it has increased from USD 0.7 billion (CY04) to USD 3.1 billion (CY06)

22. Agenda
M&A activity in India
Trends in Indian outbound M&A
Considerations in European deals

23. Explosive growth
India's M&A has grown by 150%, next only to France and Hong Kong, each of which achieved more than 200% growth
More than 80% of large Indian companies are exploring the M&A option to grow
India is second largest investor in the UK, with investments of around USD 2.0 billion ( )
Notable Deals in Europe
Aban Offshore acquires Sinvest, Norway for USD 1.3 billion (2007)
Tata Steel acquires Corus for USD 12.8 billion (2006)
Ranbaxy acquires Terapia for USD million
Suzlon acquires Hansen, Belgium for USD million (2006)
Dr Reddy's Lab. acquires Betapharm for Euro million (2006)
Reliance acquires Flag Telecom for USD million (2003)
Tata Tea acquires Tetley Tea for USD million (2000)

24. Increasing leverage
Target Debt/EBITDA levels in Western Europe
Debt/EBITDA
Total Debt on target/EBITDA levels increased from 4.93 (2005) to 5.28 (2006)
Senior Debt/EBITDA levels also increased from 3.92 (2005) to (2006) 24

25. Pricing Trends (W Europe)
Downward trend in Average Margins
Average Margins in 2006 : 238 bps (247 bps in 2005)
Source : LoanConnector

26. Agenda
M&A activity in India
Trends in Indian outbound M&A
Considerations in European deals

27. Key considerations in deal structuring
From a lender’s perspective
Key challenge is to get direct access to cashflows/assets of target (based in Europe)
Regulations differ across countries in Europe
UK has a whitewash procedure
Such is not available in other geographies

28. Financial Assistance in Europe
Country
Belgium
France
Germany
Italy
Netherlands
Spain
Financial
Assistance Permitted? No
Exceptions?
Very limited, none relevant
Refinancing may be OK if entirely separate
None
None for AG & subsidiaries
Other common forms of entity (e.g. GmbH) not covered
None relevant
Merger with target may be allowed
None for NV or subsidiaries
BV can give loans up to distributable reserves

29. Key messages
Indian clients are increasingly looking at acquisitions for growth
The confidence level has increased and these companies are not shying away from acquisitions of much larger companies
Requirements of Indian clients are not necessarily same as for corporates in other geographies
Hence, solutions need to be tailored for Indian requirements
All key decision makers in ICICI Bank are based in Mumbai, thereby enabling quicker turn around in case of last minute changes in structure/ quantum of financing
ICICI Bank knows the people who are driving the acquisitions in India and thus in critical situations has the ability to look beyond numbers

30. Recent Transactions Acquisition of Pinewood USD 118 million
Sole advisor and arranger
Acquisition of 30% stake in Energy Brands Inc.
USD 712 million
Structuring and Lead Arranger
Acquisition of
West Asia Drilling N.V.
USD 33 million
Structuring & Financing
Acquisition of Thomson SA’s CPT plants
USD 283 million
Structuring & financing
Acquisition of
Carbogen Amcis
USD 75 million
Structuring & Financing
Acquisition Hansen Technologies
USD 565 million
Structuring & Financing
Acquisition of
Amann Holdings
Euro 35 million
Lead Arranger
Acquisition of
Sinvest A.S.A
USD 800 million
Structuring & Financing

31. Recent Transactions
Acquisition of spirits business of
Shaw Wallace
USD 300 million
Advisor
Acquisition of
Typhoo Tea
GBP 80 million
Sole advisor and arranger
Acquisition of 20.2% stake in Great Lakes Carbon, US
USD 101 million
Sole advisor and arranger
Acquisition of Keyline Brands
GBP 18 million
Sole Arranger
Employee buyout of Tata Tea plantations
USD 13 million
Advisor
Acquisition of DCS Software
GBP 12 million
Sole Arranger
Acquisition of Tashkent Toytepa Textiles
USD 103 million
Structuring & Financing
Acquisition of a South African tyre manufacturer
USD 62 million
Guarantee facility

32. Thank You

33. Mergers & Acquisitions between India and Europe
14:00/15:15- Panel 2
Mergers & Acquisitions between India and Europe

34. Indian Market Entry Experience
Tim Thomas Chief Operating Officer Bharti AXA Life
Mumbai
Wednesday, May 16, 2007

35. 1.0 Market entry - a phased approach
Desk top analysis
Apr-Jul 2004
Phase 2
Strategy & business case
Aug-Dec 2004
Phase 3
Partner selection
& planning
Jan-May 2005
Phase 4
JV execution and operational
design
Sep 05-Mar 06
Phase 5
Implementation
Oct ‘05-Aug 06
Launch
Aug ‘06
Establish the viability of commencing a project to detail India market entry
Confirm scope, plan, and deliverables
Draft critical success factors
Agree project governance
Desk top data research
Initial view of potential in market
First filter of potential strategic partners
Strategy formulation for market entry into India and detailed business case examining viable entry options
Assess critical success factors for entry options
Evaluate potential partners interest and suitability and define preferred partner list
Joint Venture and structuring options
Evaluation of entry model options and optimal business model recommendation
Financial modelling and high level business case
Establish a project team on the ground in India, consisting of AXA secondee, advance hire, implementation partners and external resources
Finalise partner selection for Management Board endorsement
Develop regulatory relations
Develop high level target operational model
Finalise advance hires short list
Finalise partner negotiations, JV structuring and preparation of legal agreements
Detailed operational design (partner specific)
Marketing plan
Implementation planning covers: process, systems, infrastructure and back office, branch roll-out
Business planning and financials
Reporting and governance
Appoint key executives
Pre- launch and the 'start-up' phase preparation
Regulatory license approvals
Launch comms
Manpower recruitment
Sales force training, compensation and recruitment
Launch sales incentive programs/KPI tracking
Lead generation management
Establish JV committees

36. Thank you

37. Mergers & Acquisitions between India and Europe
14:00/15:15- Panel 2
Mergers & Acquisitions between India and Europe