Recent M&A Deals and Legal Trends in India: A Update
Mergers and acquisitions (M&A) in India are evolving faster than ever. A series of significant legal and regulatory changes up to September 2025 have reshaped the business landscape. These changes influence not only the type of deals we see but also the way companies plan and execute them. To succeed, businesses must focus on both their strategic goals and the shifting legal framework.
Recent M&A Deals and Key Legal Updates in India
Several landmark reforms are now shaping the Indian M&A market. These are not minor adjustments but structural shifts that demand new strategies.
1. Competition (Amendment) Act, 2023
The Competition (Amendment) Act took full effect on 10 September 2024. Its biggest feature is the deal value threshold (DVT). Any M&A deal worth more than ₹20 billion (about US$240 million) must be reported to the Competition Commission of India (CCI), even if the target has low assets or turnover.
Previously, many high-value tech and digital deals avoided scrutiny. Now, companies must plan for extra approval time and costs right at the start.
2. Amendments to the Companies Act, 2013
On 4 September 2025, the Ministry of Corporate Affairs (MCA) expanded the fast-track merger route under Section 233. This option, which avoids lengthy NCLT hearings, is now open to:
- Two or more unlisted companies that meet specific financial thresholds (for example, loans and deposits under ₹200 crore).
- Subsidiaries of the same holding company.
This move makes internal restructurings and business consolidations much faster and more efficient.
3. Tax Reforms in Union Budget 2025-26
The government has tightened rules on tax benefits from M&A. Companies can now carry forward accumulated losses and unabsorbed depreciation for only eight years from when the losses were first incurred.
This reform prevents businesses from “evergreening” tax losses through repeated mergers. It also forces buyers to focus more on accurate valuations and rigorous tax due diligence.
4. Changes to FEMA Regulations
In June 2025, the government amended the Foreign Exchange Management (Non-Debt Instruments) Rules. Indian companies, even in restricted FDI sectors, can now issue bonus shares to existing non-resident shareholders.
This gives foreign investors more flexibility in capital restructuring and builds confidence in India as a destination for cross-border deals.
5. Mandatory Dematerialisation of Shares
Private companies must now dematerialise their shares as part of corporate governance reforms. This step adds a new layer to due diligence. If companies do not complete this process on time, deals can face serious delays.
Emerging Trends in Indian M&A
The recent updates are shaping new trends across industries:
- Greater scrutiny – More deals must go through CCI review under the DVT rule.
- Faster internal mergers – Section 233 expansion speeds up group restructurings.
- Tighter tax discipline – Buyers now factor in the eight-year tax carry-forward cap.
- Cross-border growth – FEMA amendments make India more attractive for global investors.
- Stronger due diligence – Advisors check compliance with dematerialisation, tax rules, and competition laws more thoroughly.
The M&A Process in India: Step by Step
The M&A journey in India follows a clear series of stages:
- Strategic Planning
Companies define their main goal. Do they want to expand market share, acquire new technology, or enter fresh markets? This choice shapes whether they pursue a merger, asset purchase, or share purchase.
- Due Diligence
Advisors then carry out legal, financial, tax, and operational reviews. This is where firms like Tigde Law Firm add value by identifying hidden liabilities, checking compliance with new laws, and confirming share dematerialisation.
- Deal Structuring and Valuation
Based on due diligence, experts decide the best structure. They determine whether the fast-track option applies or if NCLT approval is required. Valuation methods also adjust to reflect the new tax rules on loss carry-forward.
- Regulatory Approvals
At this stage, companies secure clearances from CCI, SEBI, RBI, and other regulators. Cross-border deals must also comply with FEMA guidelines.
- Closing and Integration
Once approvals are in place, agreements are signed and the deal closes. The real test begins with post-merger integration. Companies must align accounting, IT systems, HR policies, and workplace culture for long-term success.
Common Challenges and Practical Solutions
- Regulatory Delays – More deals need CCI approval. Start the process early and engage experts in competition law.
- Tax Compliance Issues – The eight-year limit reduces benefits. Conduct detailed tax audits before finalising valuations.
- Cross-Border Complexities – Different jurisdictions and FDI caps still cause friction. Work with firms that specialise in global M&A, such as Tigde Law Firm.
- Cultural Misalignment – Poor integration often kills value. Build strong integration teams that focus on communication and cultural fit.
Conclusion
India’s M&A environment is entering a new phase. Recent deals show companies adapting to stricter regulations, improved transparency, and streamlined processes. At the same time, cross-border flexibility and fast-track mergers are creating exciting opportunities.
Success depends on early planning, strong due diligence, and expert legal guidance. Companies that invest in compliance and integration today will lead tomorrow’s growth in India’s fast-changing M&A market.
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