International Conference on Technology and Business Management

March 26-28. 2012

Corporate Restructuring in India with Special Reference to Strategic Intervention

Kirti Diddi Pandey Jalaj Goantiya kirtipandey@rediffmail.com luckyjalaj@yahoo.com Autonomous Mata Gujri Womens P.G. College, Jabalpur 1. Introduction
It is the learners who survive, the learned soon find themselves living in a world that no longer exists. -Erric Hoffer The environment in which organizations operate is increasingly turbulent in an era of global, national and regional commercial competitiveness. Paradoxically, competition is a part of rapidly shifting mlange of competitiveness and interdependencies. Production and communication technology are changing at an exponential rate. Furthermore, dislocation of people through downsizing and restructuring is rampant. Simultaneously, a profession of business and corporate culture is aligning itself to this changed scenario. Yesterday's strategies are not likely to work in tomorrows workplace. The Indian corporate sector is undergoing a paradigm shift to attune itself in emerging internal and external environment. The new paradigm, proclaims and asserts some strategic restructuring to derive its strength and vitality from adaptable, and committed team players at all levels, alliances, consortia, mergers and acquisitions. To foster external expansion, Indian corporate sector, as a business strategy, acquires a running business firm and grows overnight through corporate combinations. These combinations are in the form of mergers, acquisition, amalgamation and takeover and have now become important features of corporate restructuring. Such corporate restructuring, leading to external expansion of business has become popular because of the enhanced competition, breaking of trade barriers, free flow of capital across countries and globalization of business. In the wake of economic reforms, Indian industries have also started restructuring their operations around their core business activities through acquisitions, mergers and strategic interventions because of their increasing exposure to competition, both, domestic as well as international.

2. Understanding Corporate Restructuring

The intensity and pace with which the business environment is changing at both domestic and international level, is an excitingly challenging and simultaneously frightening competitive environment. It is very difficult for any firm to survive without restructuring. It may be possible to run a firm successfully for a short period, but in long run it may not be possible without the incorporation of strategic changes and reforms- Rational scanning of business environment helps in identifying business opportunities, threats and perceptions. With the onset of globalization, liberalization and privatization many firms round the globe perceive that there is a vista of profitable investment opportunities across the globe. Business firms that feel globalization is an opportunity need to leverage the benefits and capitalization, which requires huge pouring of funds and resources, and also need to go for restructuring. On the other hand, a firm that feels globalization as a threat has to compete with the new competitors by manufacturing products at high quality and sell at reasonable prices, for which it needs more technological support and more funds. Either way, the restructuring is inevitable. The concept of restructuring involves embracing new ways of running an organization and abandoning the old methods. It requires organizations or firms to constantly reconsider and review their organizational design and structure, organizational systems and procedures, formal statements on organizational philosophy, behavioral interventions, re-engineering processes and may also include values, leadership norms and reaction to critical incidents and criteria for rewarding, recruitment, selection, promotion and transfer. Strategic alliances, mergers, acquisition, joint ventures and takeover are other instruments of facilitating restructuring. In corporate circles, restructuring is emerging out as the latest buzzword. companies are vying with each other in search of excellence and competitive edge, experimenting with various tools and ideas. Many firms try to turn the business around by cutting jobs, buying companies, selling off or closing unprofitable divisions or even splitting the company. The dynamic national and international environment is radically changing the way business is conducted. Moreover, with rapid pace of change, corporate restructuring assumes paramount importance. 762

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3. Conceptual Study of Mergers, Acquisitions and Strategy Intervention

Business may grow over time as the utility of its product and services is recognized. It may also grow through an inorganic process, Symbolized by an instantaneous expansion in work force, customers, infrastructure resources and thereby an overall increase in the revenue and profits of the entity mergers and acquisition (M&A) are manifestation of an inorganic growth process. Merger refers to a combination of two or more companies into a single company where one survives and the other loses its corporate existence. A merger is a combination of two or more businesses into one business. The acquired company (survivor) acquires the assets as well as liabilities of the merged company or companies. Generally the company which survives is the buyer, which retains its identity, and the seller company is extinguished. A corporate merger is essentially a combination of the assets and liabilities of two firms to form a single business entity. Although they are used synonymously, there is a slight distinction between the terms merger and acquisition. Strictly speaking, only a corporate combination in which one of the companies survives as a legal entity is called a merger. In a merger of firms that are approximate equals, there is often an exchange of stock in which one firm issues new shares to the shareholders of the other firm at a certain ratio. In other words, a merger happens when two firms, often about the same size, agree to unite as a new single company rather than remain as separate units. This kind of action is more precisely referred to as a merger of equals. Stocks of both the companies are surrendered, and new company stock is issued in its place. When a company takes over another to become the new owner of the target company, the purchase is called an acquisition. From the legal angle, the target company ceases to exist and the buyer gulps down the business and stock of the buyer continues to be traded. In summary, the term acquisition is generally used when a larger firm absorbs a smaller firm and the term merger is used when the combination is portrayed to be between equals. For the sake of discussion, the firm whose shares continue to exist (possibly under a different company name) will be referred to as the acquiring firm and the firms whose shares are being replaced by the acquiring firm will be referred to as the target firm. However, a merger of equals doesnt happen very often in practice. Frequently, a company buying another allows the acquired firm to proclaim that it is a merger of equals, even though it is technically an acquisition. This is done to overcome some legal restrictions on acquisitions. Synergy is the main reason cited for many Mergers & Acquisitions. Synergy takes the form of revenue enhancement and cost savings. By merging, the companies hope to benefit through staff reductions, economies of scale, acquisition of technology, improved market reach and industry visibility. Having said that, achieving synergy is easier said than done, synergy is not routinely realized once two companies merge. Obviously, when two businesses are combined, it should result into improved economies of scale, but sometimes it works in reverse. In many cases, one and one add up to less than two. Excluding any synergies resulting from the merger, the total post-merger value of the two firms is equal to the pre-merger value, if the synergistic values of the merger activity are not measured. However, the post-merger value of each individual firm is likely to be different from the pre-merger value because the exchange ration of the shares will not exactly reflect the firms values as compared to each other. The exchange ration is distorted because the target firms shareholders are paid a premium for their shares. Synergy takes the form of revenue enhancement and cost savings. When two companies in the same industry merge, the revenue will decline to the extent that the businesses overlap. Hence, for the merger to make sense for the acquiring firms shareholders, the synergies resulting from the merger must compensate more than the value lost initially. Different Forms of Mergers There are a host of different mergers depending on the relationship between the two companies that are merging. These are: Horizontal Merger: Merger of two companies that are in direct competition in the same product categories and markets. Vertical Merger: Merger of two companies which are in different stages of the supply chain. This is also referred to as vertical integration. A company taking over its suppliers firm or a company taking control of its distribution by acquiring the business of its distributors or channel partners are examples of this type of merger. Market-extension Merger: Merger of two companies that sell the same products in different markets. Product-extension Merger: Merger of two companies selling different but related products in the same market. Conglomeration; Merger of two companies that have no common business areas. 763

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Strategic Intervention According to John Collins, Competing in the market place is like war, you have injuries and causalities, and best strategy wins. Strategic Intervention means a multi-business firm, the resource allocation process i.e, how cash, staffing, equipment, and other resources are distributed at corporate level. The corporate level managers are responsible for diversification and the addition, of new products of services to the existing products or service line-up. Formulation of strategic intervention involves assessment of market conditions in which an organization operates. Various alternative strategic interventions that an organization can follow are categorized into different ways, namely; forward integration, backward integration, horizontal integration, market penetration, market development, product development, concentric diversification, horizontal diversification, joint venture, retrenchment, divestiture and liquidation and a combination strategy. There are four generic models of corporate strategic intervention; they are stability strategies, growth strategies, retrenchment strategies and combination strategies. Each of the strategic intervention has a specific objective. For instance, stability strategy intervention is utilized by a firm to achieve steady, but slow improvement in growth, a growth strategic intervention seeks to alter a firms strategic track by adding new product lines. Retrenchment strategic intervention like harvesting, turnaround, divestiture, or liquidation is used to reverse poor organizational performance.

4. Review of the Literature

The New Economic Policy of India (1991) and insertion of Indian economy in the process of globalization and liberalization, generates many pertinent areas of research for deep insight specially, in the corporate arena of India. Since then the academicians, intelligentsia, entrepreneurs, scholars, etc conducted an empirical investigation on issues related to the corporate sector. Corporate restructuring, Mergers and Acquisitions are some issues which in recent past have pre-dominated the business and management arena. Aggarwal, Jagge and Mandelkar (1992) studied post merger performance of the companies with a different perspective. They adjusted data for size effect and beta weight return and found that shareholders of the acquiring firms experienced a wealth loss about 10% over the period of five years. Kedia, B.L. and Mukherji, A (1999) studied the prerequisite of managerial mindset and preparedness to cope up with global competitiveness. Shrivastava, R.M. 1st ed. (1999) in his book critically examined management policy and strategic management in India, context, specially reflecting upon various concepts, skill and practice. Simon R. (1999) in his research article analysed various risk factors in corporate firms in the light of present volatile market and global competitiveness. Mark R. Stone (2002) makes a comparative study of corporate restructuring efforts in some European and Asian countries in the light of role of Government in mitigating the corporate crises. Mark J. Roe (2003) examined the political determinants of corporate governance along with the comparative analysis of legal framework of various countries. Prashant Kale and Harbir Singh (2004) in their articles on M&A between 1982 and 2002 concluded that in the initial years of economic liberalization, Indian companies failed to create sufficient value from acquisition, as compared to Multi National Companies. David E. Vance (2006) in his work laid down the practical approach to rescuing troubled companies and driving under performing companies to top performance. His work explores the utility of combination and proven restructuring strategies with theoretical analysis. Rakesh Kumar Sharma (2007) has analysed different modes of corporate restructuring in India with special reference to conglomeration and mergers. Poter (2007) attemped to study the relationship between acquisition and its effect on expansion of corporate world. Michael Pomerleono Jan et dal. (2008) in his study examined role of strategy in corporate sector in the wake of the periodic financial crises of the late 1990s. The work recognized that International financial Institutions and experts have to realize the need for a strategy to avoid and mitigate the severity of crises in the corporate sector. Ashwani Puri (2008) opined that Business Restructuring in India has been slow and expensive. Lack of conducive regulatory environment, a complex tax framework, court processes and an endless list of compliance issues impede the process and impair efficient and effective realignment of resources through restructuring. Yasmeen Rizvi (2008) in his research paper has discussed that Acquisition Strategy is a potent tool for survival and growth of the corporate sector in India. He also discussed various Acquisition Strategies with case analysis of the acquisition of Gillette India Limited by Procter and Gamble. Madhura (2010) laid down various possible types of corporate restructuring and critically examined feasibility of such types in restructuring Indian corporate sector.

5. Corporate Restructuring at Global Plane

Corporate restructuring is becoming more and more prominent in the global economy. According to Peter.F. Drucker, the management guru, the greatest change in corporate culture, and the way business is being 764

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conducted, is the strategic intervention and relationship based not on ownership, but on partnership (Drucker, 1996). He also observed that there is not just a surge in alliances but a worldwide restructuring of companies in the shape of alliance and partnerships. According to a recent survey by the global consulting major, Booz, Allen and Hamilton, corporate restructuring in the form of strategic alliance is spreading in every industry and is becoming an essential driver of superior growth. The corporate restructuring in terms of number of strategic alliances in the world is surging. For instance more than 20,000 new alliances were formed in the U.S between 1987 and 1992, compared with 5100 between 1980 and 1987 and 750 during the 1970s. The firm also predicts that within the next five years, the value of alliances is projected to range between $30 trillion to $50 trillion. The survey also reveals that more than 20% of the revenue generated from the top 2,000 US and European companies now comes from alliances, with much more predicted in the near future. Since 1980s, corporate restructuring via strategic alliances have been very popular. Strategic Alliances in the form of mergers and acquisitions are proving to be a powerful tool, particularly in today's world, due to the need to build differential capabilities in more areas than a company has resources or time to develop. The legendary Jack Welch, who headed GE in the past, echoing this sentiment once said, "If you think you can go it alone in today's global economy, you are highly mistaken." During the early 1980s Mexico adopted a government scheme to restructure corporate foreign debt following the disruption of external debt payment and the drying up of new lending in 1982. The government in early 1983 established the Foreign Exchange Risk Coverage Trust Fund known as FICORCA. About $12.5 billion in debt of some 2,000 corporation was restructured under FICORCA. Chile recapitalized bank and implemented government plans to restructure corporate debt during the early and mid-1980's. To provide incentives for debt servicing and re-establish a sound banking system, the authorities improved bank supervision and regulation, recapitalized private bank by purchasing substandard loans at par in 1982, 1984 and 1986 and implemented several schemes giving financial incentives for debt restructuring. Hungary during 1991-1995 made several approaches to corporate debt restructuring. Under the tough "bankruptcy" law of 1991 under the new scheme, 55 firms were restructured by government directly. During the Asian crisis of 1997-1998, Thailand combined several of the restructuring approaches. To encourage banks to restructure their holdings, non performing loans, after they have been restructured were relaxed. Most of the European countries initiated corporate restructuring through banks and financial reform and up to certain extent, the government intervention. According to the 2008 Boston Consulting Group (BCG) New Global Challengers report, BCM 100, top companies from rapidly developing economies (RDEs) such as India, China, Russia, Mexico and Brazil, are changing the world and challenging the dominance of establishing multinational players across the world. In 2006, they completed 72 outbound acquisitions, up from 21 in 2000. The average size of these transactions grew from $156 million in 2001 to $981 million in 2006. Of the 100 companies on BCG's list, 41 are from China, 20 from India and 13 from Brazil, with the rest coming from other Rapidly Developing Economies.

6. Corporate Restructuring in India

The opening up of the Indian economy and the governments decision to disinvest, and dismantle all certain qualitative and quantitative restraints has made corporate restructuring more relevant today, compelled by the present economic scenario and market brands. In the last few years, Indian corporate sector has followed the worldwide trend in consolidation amongst companies through mergers, acquisitions and strategic interventions. The corporate restructuring in India through Mergers and Acquisitions is facilitated by the Supreme Court of India which in the land mark judgement of HLLTOMCO merger has said, in this era of hyper competitive capitalism and technological change, industrialists have realized that mergers/acquisitions are perhaps the best route to reach a size comparable to global companies so as to effectively compete with them. The harsh reality of globalization has dawned that companies which cannot compete globally must sell out as an inevitable alternative. Economic reforms and deregulation of the Indian economy have brought in more domestic as well as international players in Indian industries. The first merger and acquisition wave took place in India towards the end of 1990s Table 1 shows the number and percentage change in the number of merger and takeover activities in India from 1988 to 2003. These mergers and takeover include the realized as well as abortive bids Table 2 exhibits a sharp rise in the overall merger and acquisition activity in the Indian corporate sector while there were 58 mergers and takeovers from 1988 to 1990, the number rose to 71 in 1991 and 730 in 1998. There was a jump in the number of merger and takeovers activities from 1988 to 1993, the average rate of increase being around 89 percent for the five year period. Since then the rate of rise had maintained an average of 20.5 percent. After 2001, the mergers & acquisitions trend has shown a decline. But there was substantial growth in the year 200001, with the total number of Mergers &Acquisitions to be 1,177, which is 54 percent higher than the previous years total deals. Indian M&A market as ended 2006 can be seen through Table 2. 765

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Table 1 Number of Merger and Takeover in India from 1988 to 2003 Years Number Change in % 1988 15 1989 18 20.00 1990 25 38.90 1991 71 184.00 1992 135 90.10 1993 288 113.30 1994 363 26.00 1995 430 18.50 1996 541 25.80 1997 636 17.60 1998 730 14.80 1999 765 04.79 2000 1,177 53.86 2001 1,045 -11.21 2002 838 -19.81 2003 834 -0.48 Source Collected from Various Newspapers including Business Dailies, Various Issues and also Monthly Review of the Indian Economy, Centre for Monitoring Indian Economy, Various Issues Table 2 Top 10 India Mergers & Acquisitions Deals Target Acquirer Acquirer Deal Value ($ mn) Nation Corus Group UK Tata Steel India 14,305.25* Reliance Industries India Shareholders India 8,063.00 Reliance Infocom India Reliance Comm Ventures India 5,577.17 Reliance Capital India Reliance Capital Ventures India 1,743.80 Idea Cellular India Investor group India 988.00 Reliance Energy India Reliance Energy Ventures India 906.57 Omimex Colombia Mansarovar Energy India 850.00 Flextronics India KKR US 850.00 Essar Oil India Vadinar Oil India 835.07 Dr. Reddys India Betapharm Germany 570.00 Figures for January-December, 2006. * Deal pending Source B.W. Thomson Financial M&A Roundup, Business World, 22nd January, 2007, p. 23 Target

The scenario for corporate Restructuring driven by Mergers & Acquisitions changes dramatically in the 90s with the Tatas selling TOMCO and Lakme. Suddenly selling out has become a sensible option. Mergers and acquisitions in India are primarily aimed at expanding a companys business and profits. Acquisitions bring in more customers and business, which in turn brings in more money for the companies thus helping in its overall expansion and growth. Consolidation in the form of mergers, acquisitions and strategic interventions has become a compelling necessity to counter the effects of increasing globalization of businesses, declining tariff barriers, price decontrols and to please the ever demanding and discerning customers. The Mergers & Acquisition activity is helping the companies to restructure, gain market share or access to markets, rationalize costs and acquire brands to counter these threats. Experts feel that Indian companies look at mergers & acquisition due to the size factor, the niche factor or for expanding their market reach. They also opine that acquisitions help in the inorganic (and quicker) growth of the business of a company. Besides these factors, the pricing pressure and consolidation of global companies by building offshore capabilities have made M&A relevant for Indian enterprises to grow in size by adding manpower and to facilitate overall expansion by moving into new market space. Gaining new customers is another reason behind M&A. For instance V Moksha, an IT firm, saw a rise in the number of its customers due to acquisitions as it expanded considerably in the US market and leveraged on the existing customer base. The Polaris-orbi Tech merger helped in combining skill sets of both companies, which consequently led to growth and expansion of the merged entity likewise, Wipro acquired GE Medical System Information Technology (India) to leverage its expertise in the health science domain. What makes the most recent wave of M&As 766

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different is the involvement of global players. Foreign private equity is coming into Indian companies like New Bridges recent investment in Shriram Holdings. Meanwhile, Indian companies, sensing attractive opportunities outside the country are also venturing abroad. Tata Steel has bought Singapore based Nat Steel for $486 million. Videocon has bought the colour picture tubes business of Thomson for $290 million.
Table 3 The Top 10 Acquisitions made by Indian Companies Worldwide (Sharma, 2008) Acquirer Tata Steel Hindalco Videocon Dr. Reddys labs Suzlon Energy HPCL Ranbaxy Labs Tata Steel Videocon VSNL Target Company Corus Group Plc Novelis Daewoo Electronics Corp. Betapharm Hansen Group Kenya petroleum Refinergy Ltd. Terapia SA Natsteel Thomson SA Teleglobe Country Targeted UK Canada Korea Germany Belgium Kenya Romania Singapore France Canada Deal Value ($ ml) 12,000 5,982 729 597 565 500 324 293 290 239 Industry Steel Steel Electronics Pharmaceutical Energy Oil and Gas Pharmaceutical Steel Electronics Telecom

For a better understanding and having a deep insight of the topic it is worthy to have a case analysis of some related events taken place in the corporate arena. Some of vital events of mergers and acquisitions that have taken place is being presented in the case study form. Case Study-1 Nicholas Piramal India Ltd: Profiting from Mergers and Acquisition Nicholas Piramal India Ltd (NPIL), best known for its growth by mergers and acquisitions, is among the top ten companies in the domestic formulations market with a major presence in anti-bacterial, CNS & CVS-Diabetic. NPIL has expanded aggressively after the Nicholas group took over Nicholas Laboratories in 1986. The turnover and net profit have grown at a healthy compounded annual growth (CAGR) of 33% and 45% respectively in the past decade. With more than a dozen joint ventures with pharmaceutical companies in different healthcare segments, NPIL has mastered the art of forging JVs and running them successfully. Prices of over 60% of the drugs and formulations are controlled by the government through DPCO in the Rs. 130 billion Indian pharmaceutical market. In the domestic bulk drugs market, low entry barriers have resulted in overcapacity and price wars. Major domestic players are, therefore, focusing on formulations, where brand image and distribution network act as entry barriers. They are increasing their overseas marketing and manufacturing network to enhance their exports (under patent drugs to third world countries and generics to developed nations). In anticipation of WTO regime, multinational corporations are strengthening their operations in India by setting up 100% subsidiaries or through marketing tie-ups with major domestic players. The big local players are also strengthening their operations through brand acquisitions, co-marketing and contract manufacturing tie-ups with MNCs. Case Study - 2 Following this trend, NPIL is focusing on strengthening its R&D to gear up for the patents regime. The companys R&D facility with more than 100 scientists (acquired from Hoechst Marion in 1999, renamed as Quest Science Institute) is one of the best R&D centers in India. NPIL has hived off its Falconnage (glass) and bulk drug division into separate entities to improve efficiencies. It is working on seven new chemical entities (NCE). The first one, an anti-malarial drug, is already commercialized. NPIL has set a growth target of more than 30% through aggressive product launches as well as mergers and acquisitions of brands and companies in the therapeutic segment of anti-bacterial, CVS-diabetes, Nutrition and GI tract and Central Nervous System (CNS).

7. Legal and Regulatory Guidelines for Corporate Restructuring in India

The Constitution of Indian enshrined some provisions which provide the base ground for all legal, regulatory and statutory frame works for the corporate sector in India. Around the globe many nations have evolved a number of codes and standards for corporate governance. Along with the rise in the number of merger and Acquisition deals, over time, cross-border mergers and acquisitions are becoming popular as transnational 767

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corporations take advantage of wide spread liberalization and deregulate in an effort to gain market shares. Historically, most matters relating to the rights of share holders were governed by the Companies Act, 1956. The provisions of Companies Act, 1956, govern mergers and amalgamations of domestic companies; Acquisition of companies comes under the provision of takeover code of Securities and Exchange Board of India (SEBI). The Securities and Exchange Board of India was set up as a statutory authority in 1992, and has taken a number of initiatives in the area of investor protection. In recent years, an increasing number of firms have realized the necessity for greater transparency, independent management, and the protection of minority share holders and creditors in order to maintain competitive pace in the expanding capital markets. Responding to such sense of urgency, serious efforts were made in the country in 2000, 2001 and 2002 when certain corporate governance reforms were announced by amending the companies Act of 1956. The Legal and Regulatory framework of corporate governance in India composes of Industries (Development & Regulation) Act, 1951, Companies Act 1956, Income Tax Act, 1961, monopolies and Restrictive Trade Practice Act, 1969 (MRTP Act); Foreign Exchange Regulation Act (FERA), 1973, Sick Industrial Companies (special Provision) Act, 1985 (SICA, 1985); Foreign Exchange Management Act, 1995 (FEMA); and Competition Act 2002. Corporate governance in India is driven by a supportive legal regulatory and accounting environment need, necessary for successful corporate restructuring. Important legal aspects of restructuring include foreclosure standards, Foreign investment rules, and merger and acquisition policies for facilitating complete restructuring transactions.

8. Steps for Rationalizing Corporate Restricting

Corporate restructuring in a developing country like India is potentially one of the most challenging tasks faced by economic policymakers. The federal structure of India with hostile political environment makes it inevitable for government and leadership to take lead in establishing restructuring priorities, addressing market failures, reforming the legal and tax systems specially in the wake of financial crises when corporate distress is pervasive. Corporate governance must be brought up to international standards to provide incentives for viable firms to restructure their balance sheets and maximize their value. A supportive legal, regulatory, and accounting environment is to be created for successful corporate restructuring. Important legal aspects of restructuring include foreclosure standards, foreign investment rules and mergers and acquisition policies. Restructuring should be based on a holistic and transparent strategy encompassing corporate and financial restructuring. Effective measures should be taken quickly to offset the social costs of crises and restructuring. Government should be prepared to take on a large role as soon as a crisis is judged to be systemic.

9. Conclusion
The pace with which national and international environment is radically changing with the interplay of National, Regional and International financial institutions, makes corporate restructuring assume paramount importance in Indian context, since most of the innovations, norms, practices and inventions in terms of corporate principles are laid down by western industrialized nations, and then percolated to Indian environment. Corporate restructuring, as an effective instrument to serve share holders better, has been a very successful concept abroad and its been followed all the more in high context culture like India. The corporate restructuring in India is determined by both internal and external factors. Internal factors like expansion of service sector, regional disparity, abundance of Human resource. Political and legal framework determine the functional aspect of any corporate firm. On the other hand, external factors like increased price volatility, tax asymmetric, development in technology, regulatory changes, liberalization, increased competition and reduction in information and transaction casts, have lead to a practice of corporate restructuring as a move to maximize the shareholders value and coinciding with the contemporary Human Resource planning and development process in the Indian corporate sector. The strategic instruments for corporate restructuring in India are predominated by mergers acquisition and genuine strategic interventions. The 14 SAs are generating sufficient leverage for Indian corporate sector. At the same time, the difficulties involved in making M&As click must not be underestimated. A paradigm shift is likely in the coming years. Friendly deals could give way to aggressive ones. In future, we may see hostile bids and leveraged buyouts. Most M&As so far have been cash deals with sensex erasing good, stock deals may become more common. As the appetite for deal making increases, the valuation so also bounds 768

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to go up. Thus corporate restructuring in India has enabled several organizations to respond more quickly and effectively to new opportunities and unexpected pressures, there by reestablishing their competitive advantage.

10. Scope for Further Research

Research is an open ended continuous process of analysis review, observation and hypothesis verifications. The authors are of the view that corporate restructuring in India is determined by a variety of factors, facilitating scope for in-depth studies and analysis of other such factors. The structural development programmes taking place at a global plane and the drive for third generation of macro economic reforms in India, the scope for further research on corporate restructuring specially in the light of Foreign Direct Investments (F.D.I.) in multi retailing sector and growing India- ASEAN economic and trade relations.

11. Abbreviations
M&AWTO BCG RDEs MNCs Mergers And Acquisitions World Trade Organizations Boston Consulting Group Rapidly Developing Economies Multi National Companies

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