By C. Antoine Marchand
Practice Leader – Mexico
Companies domiciled in India have become some of the most energetic players in a developing Mexican mergers and acquisitions scene.
Indian businesses involved in producing food ingredients and specialty chemicals have been some of the most dynamic acquirers of Mexican companies, but other sectors are of interest as well. We began to see interest about 12 months ago, with the acquisition of Mexican mid-market specialty chemicals companies by India-based companies.
Mexico’s industrial specialties, including chemicals, automobile parts, information technology and pharmaceuticals, are seen as attractive acquisition targets for Indian companies looking for the opportunity to expand into the Western Hemisphere. Mexico is viewed as a good base for moving into the Americas, including the United States.
One reason for Mexico’s popularity among Indian companies in the food ingredients and specialty chemicals space is that many of the certifications required of Mexican companies are quite similar or identical to those required in the United States.
Indian business executives are savvy. They understand that to expand into the Western Hemisphere, they need to take a basic industry route. As a result, they are looking to buy companies engaged in fundamental manufacturing and distribution of specialty chemicals and food ingredients.
Once they have investments in basic industries, they expect to have an easier time moving up the value chain and acquiring companies that are more technologically complex.
Mexico also makes good sense for expansion because of India’s similar business culture. Both countries are developing economies, and there is a good cultural fit in the way business is done. In both countries, for example, businesses often are family owned and operated, with most companies changing hands between generations, as opposed to being sold to outsiders.
Capital Alliance has a dedicated team of Mexico specialists who offer global expertise and reach to Mexican companies looking to sell to foreign business entities. Capital Alliance has been a member of M&A International Inc. since 1986. M&A International Inc. offers the unparalleled global resources of over 600 M&A professionals operating in every major financial center of the world.
C. Antoine Marchand was born and raised in Mexico and is Capital Alliance’s Mexico Practice Leader. He has extensive experience structuring cross-border M&A and strategic alliance transactions. Reach him at Antoine.Marchand@cadallas.com.