Corus takeover turns India euphoric

Bangalore, India: This former British colony is discovering that it is far better to take over than be taken over. India erupted with serves-them-right jubilation this week when Tata Group, an Indian conglomerate, won a bid for the Corus Group — the Anglo-Dutch descendant of British Steel — for more than $12 billion, the largest acquisition ever by an Indian firm. Headlines spoke of empires striking back, while pundits and industrialists said India had at last arrived as a world power.

As the value of overseas bids by Indian firms soared to $21 billion last year from less than $1 billion in 2000, according to the market researcher Dealogic, an elite slice of this country has grown intoxicated by the fantasy that it will one day own the world.

The takeover of Western companies by Indians has struck many here as evidence of a delicious reversal of fortune: a once-proud civilization, having fallen to the humiliations of colonization, is now buying out the hallowed corporations of the West.

A leading Indian newspaper painted that sentiment across its front page early this month with a huge drawing of what New York’s Times Square could look like once Indian companies complete their global acquisition spree. Stripped from the billboards were iconic American brands: McDonalds, Budweiser and NBC. In their place were Indian companies that few in New York have even heard of: Videocon, Reliance Industries and Tata.

“It’s as if the civilization was always born to be a front-running civilization,” said Rahul Kansal, chief brand manager of The Times of India, an English-language daily that has eagerly stoked the takeover euphoria, and whose sibling, The Economic Times, printed the Times Square spread.

“We were eclipsed for a while, overtaken by foreigners and foreign rule for a few centuries, and this is a comeuppance that is deserved — the need for some retribution,” Kansal said.

But for the dark suits who live by price-to-earnings ratios rather than postcolonial optimism, such talk is evidence of euphoria veering on hubris. Investors shaved more than 13 percent from Tata’s market capitalization since talk of the deal began, because of fears that it was overpaying.

And many are asking if, in these heady times, Indian companies will maintain the sobriety needed to manage the difficult and nuanced process of acquiring and digesting a foreign corporation...

Excerpted from a piece in the ‘International Herald Tribune’, February 1

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