JSA is a leading national law firm in India with more than 500 professionals operating out of our seven offices: Ahmedabad, Bengaluru, Chennai, Gurugram, Hyderabad, Mumbai and New Delhi. For more than 30 years, we have provided legal representation, advice and services to leading international and domestic corporations, banks, financial services providers, funds, governmental and statutory authorities, as well as multilateral and bilateral institutions. We are recognised as the Indian law firm that led – and continues to lead – a paradigm shift towards institutionalising and professionalising law firm ownership and management. This is reflected in our work as we blend ever-evolving modern-day law and business with traditional values of excellence and integrity.

Ranked among the leading M&A advisers in India, JSA draws upon its experience of working on transactions across industries of all sizes to provide integrated solution-orientated advice. Our one-national-practice structure maintains a dedicated team of intelligent and talented M&A lawyers and robust infrastructure across important locations in India, enabling us to provide cost- and time-efficient services to our clients.

We handle the full range of M&A transactions, including:

a) Acquisitions and divestments – of shares, assets and businesses (by private, public and listed entities);
b) Schemes of arrangement, mergers, demergers and amalgamations;
c) Leveraged buy-outs and management buy-outs;
d) Tender and exchange offers;
e) Sale and purchase of distressed assets; and
f) Restructurings, including capital and debt restructuring, buy-back of securities and reduction of capital.

Our sector-focused approach allows us to interact with diverse M&A clients and address the transactions in a more scientific manner, with sector experts bringing their experience to bear. We are, therefore, well equipped to identify commercial issues specific to the sector and can assist the parties in reaching a resolution on various deal terms more effectively. Meanwhile, our rich history in India – spanning two decades – allows us to understand and translate the regulator’s approach to transactional issues, as well as country risks where applicable, and to forecast economic sector issues that may be relevant to a transaction.

Our resilience and result-orientated approach is appreciated by our clients across industries. To demonstrate, some of our client testimonials are reproduced below:

“They are excellent, very focused on all aspects, including commercial terms and prompt service. They dig deep into the matter and upturn every stone to protect clients.”

“JSA is clearly one of the star performers…”

“JSA handles complex matters with ease and is pragmatic in its advice, thereby giving the client comfort that the hurdles will be crossed.”

“They are seen as the law firm that heralded a paradigm change in India in institutionalising and professionalising law firm ownership and management. With a keen focus on learning and specialised practices, they keep in touch with the changing environment in which our clients operate.”

“The team members are responsive and able to advise promptly on complex M&A matters and cross-border issues.”

In India, corporate law is primarily governed by the (Indian) Companies Act, 2013 (“Indian Companies Act”), which forms the basic legislative context governing and regulating every company in India. In addition to regulating companies through disclosures and compliance-related framework, the Indian Companies Act is also relevant from an investor’s standpoint, as it also legislates on corporate structuring/restructuring and investor protections.

The securities market is regulated by the Securities & Exchange Board of India (“SEBI”) Act, 1992, accompanied by rules and regulations thereunder – regulating the IPO process, rights issues and other corporate actions by public companies inter alia requiring compliances and disclosures to be undertaken by such companies.

The Foreign Exchange Management Act (“FEMA”), 1999, including its rules and regulations, form the relevant exchange control laws and govern the transfer of foreign exchange into and out of India.

Moreover, the Insolvency & Bankruptcy Code, 2016, regulates liquidation and insolvency resolution of Indian companies, facilitated by official liquidators and insolvency resolution professionals.

These legislations form the core of Indian corporate legal framework, and are more stringent as compared to legislations in some other jurisdictions, primarily due to an increased number of disclosures and compliances. Furthermore, Indian corporate laws and their amendments are reflective of lawmakers’ attempt for a relatively more progressive legal system. For instance, the Indian Companies Act requires the appointment of a female director to the board of a public or listed company, and has also made corporate social responsibility mandatory for companies that exceed a certain net worth or turnover. Such provisions are absent in neighbouring jurisdictions, such as Bangladesh, and so frequently, Indian legislations are used by neighbouring countries to formulate their own laws.

The unique complexity of Indian corporate law is that Indian Acts pertaining to corporate laws are supplemented with a multitude of rules, regulations, notifications, guidelines and circulars, etc., which makes it imperative for lawyers to have a firm grip on the Act and its numerous supplementary laws for providing legal advice. In addition, Indian corporate laws are dynamic, which means they are amended frequently, requiring lawyers to keep up with such frequent updates and their supplementary laws at all times.

In 2023, India witnessed a large volume of transactions. Subsequently, in the first half of 2024, the country was able to remain on par with the previous year’s numbers due to certain high-value transactions in private equity and M&A. As per Grant Thronton Bharat’s Q2 2024 Dealtracker, the first quarter of 2024 alone accumulated approximately USD 20 billion. The second quarter accumulated approximately USD 15 billion.

As a firm, we have participated in numerous high-value transactions recently. Some examples of marquee transactions spanning 2023–2024 include:

a) Assisting Temasek Holdings in its acquisition of a majority stake in Bengaluru-based Manipal Hospitals. Temasek acquired an additional 41% stake in Manipal Hospitals, to hold a majority stake of 59%, making it the largest healthcare private equity deal in India in 2023. The estimated deal value was more than USD 2 billion;

b) Assisting BPEA EQT on its acquisition of HDFC Credila for approximately USD 1.35 billion. It is India’s largest non-bank education loan specialist, enabling academic studies for the country’s growing young population – marking the largest ever private equity buyout in the Indian financial services sector;

c) Assisting Paramount Global on its exit from Viacom18 by selling its remaining 13.01% stake to Reliance Industries Limited (“RIL”) for approximately USD 500 million. As part of the larger transaction of USD 8.5 billion, RIL and the Walt Disney Company will form a joint venture that will merge the media undertaking of Viacom18 with Star India through a court-approved scheme of arrangement. This is one of the largest deals in media space in India;

d) Assisting Rental Yield Plus Fund, managed by Edelweiss Alternatives, on the acquisition of MMTP Projects Private Limited for more than USD 178 million.

For many companies, the Indian market can be a lucrative space, as there is a vast number of Indian consumers with increasing purchasing power, which has led to companies wishing to expand their businesses to India. We have actively participated in differing segments of deals, including: strategic M&A, private equity investments and exits, as well as leveraged deals, among others.

We are currently assisting in a multi-layer transaction that involves a share swap between a private limited company and a public listed company in India, wherein some of the parent companies and shareholders are non-residents. This requires approval from the Competition Commission of India, an open offer under the SEBI regulations, as well as other regulatory approvals and compliances under the (Indian) foreign exchange laws. It further involves the complex structuring of an overseas entity for the purposes of distribution of the proceeds arising out of the sale of shares allotted pursuant to the share swap.

The proposed transaction is challenging on multiple levels, including structuring, pre-transaction and post transaction compliance, as well as the overall organisation of the deal – especially given the complexities surrounding multiple regulatory approvals on multiple levels in the context of numerous non-resident parent companies.

There are various economic, social and political concerns that are relevant throughout any M&A deal, from its ideation to execution. Such factors are crucial for an M&A transaction, and often act as deal drivers.

A primary driver is the potential of a target company to generate profits, and so such factors as inflation become relevant. As inflation increases the cost of goods and services, it reduces the profitability and future cash flow projections for the target company. Therefore, investors are less likely to invest in an inflation-ridden jurisdiction.

While India is at a 4.4% inflation rate – as per data released by the IMF for 2024 – the surge in M&A reflects that the downsides of inflation have not impacted the country’s overall potential to garner investments. This is also due in part to the employability of India’s workforce in the technology and service sectors, which have received the highest amount of FDI in FY 2023–24 (equalling USD 7.9 million and USD 6.6 million respectively), as per data released by the Department for Promotion of Industry & International Trade.

Secondly, political factors, such as tensions between countries concerning supply chains, act as major deal determinants. For instance, given the current political tensions concerning the US-China supply chain, India is boosting its manufacturing capabilities to cater to the requirements of investors choosing to exit their China operations. Many large corporations are considering India as a suitable alternative to their Chinese investments, thereby opening doors for a further surge in overseas investments, while the growth of domestic manufacturing capabilities is leading to a number of strategic M&As.

Finally, many companies attempt to utilise offshoring to seek new markets and lower operational costs. We are, however, witnessing a change in this thinking. Rising energy and shipping prices, withdrawal of tax incentives, as well as geopolitical risks, such as the global shipping crisis caused in part due to the conflicts in the Red Sea, are some reasons why a company with an offshore business would consider reshoring their businesses back to their home country to bring it closer to its main consumer base. This may negatively impact India in the near future, unless the region is able to leverage its strengths with more investor-centric reforms. However, the country will continue to prove attractive for investments, as its burgeoning population and rising middle-class power, combined with its readily available market and large number of educated youth, gives rise to a large talent pool.

Sectors experiencing extensive deal activity include TMT, services, healthcare and pharmaceuticals, retail, renewable energy and manufacturing. Indeed, there has been a significant boost in Q1, 2024, due to high value deals in the media and entertainment sectors.

TMT
In line with current global trends, we have seen a high level of interest in advancing technologies. Investors and technology giants alike have been investing into India to facilitate the growth of AI. In contrast, there are large companies that are looking to sell their media businesses or form strategic partnerships in India. This is likely due to the jurisdiction’s fierce consumer market, wherein foreign media companies are struggling with competitive pricing in a bid to win over Indian consumers. An example of this is Over the Top (“OTT”) media services, which include streaming platforms. India has several homegrown streaming services with cheap prices, and so the cost of matching these prices, along with the larger volume of consumers, puts foreign media giants at a loss.

Healthcare & Pharmaceuticals
Ever since the COVID-19 pandemic, there has been increased concern surrounding medical technology, healthcare facilities and pharmaceuticals around the world. India, which is well known for medical tourism, has seen an exponential boost since then. Accordingly, we have participated in several transactions regarding medical equipment and technologies, as well as transactions for acquisition of IP.

Retail
Following the pandemic, the e-commerce and retail sectors have faced a massive boost, and many large retailers are now looking to expand into other jurisdictions via cross-border M&A. This is in part due to consumer habits changing, combined with India’s middle class having more purchasing power. As per RIL’s annual report, the country’s retail sector is projected to grow by USD 1.4 trillion by 2027.

Renewable Energy, Manufacturing & Automobiles
After India’s commitment at the COP26 summit to reach 500 GW of renewable energy by 2030, there has been significant interest in the renewable energy sector by investors. We have witnessed an increase in inbound investments, particularly in the solar and wind energy spaces.

Initiatives such as “Atmanirbhar Bharat Abhiyaan” and “Make in India” have highlighted India’s stance and dedication to becoming self-reliant, and have been proven to increase the country’s manufacturing prowess.

At the intersection of the renewable energy, manufacturing and automobile sectors is India’s increasing influence in the manufacture of Electronic Vehicles (“EVs”). At COP26, the country committed to reach the goal of 30% of private vehicles as EVs by 2030. Consequently, large EV manufacturing firms are looking to India to manufacture their vehicles; moreover, the country has received large amounts of FDI towards EVs.

We work with a mixture of large corporates and SMEs. We have the experience to provide end-to-end advice and assistance, including advice on high-level structuring issues, conducting legal due diligence, participating in negotiations, as well as drafting the necessary documentation – such as term sheets, share purchase agreements, implementing agreements in case of complex transactions and corporate resolutions, while also assisting with signings and closings. Furthermore, we offer high-level capabilities in preparing, filing and pursuing the requisite court applications and petitions, representing before the National Company Law Tribunals, High Courts and other statutory authorities.

As larger corporates face more challenges and deal flows, they are typically more inclined to seek such legal assistance and advice. There is also a greater scope of legal assistance and advice to be rendered in the case of transactions, which typically involve large corporates. We also provide sector-specific expertise relevant to these large-scale transactions, and have thus worked extensively with large corporates.

While our expertise typically lies in catering to the dynamic and ever-evolving requirements of larger corporates, we also advise SMEs and even non-profit organisations regarding legal challenges, as well as regulatory compliance. There are several instances wherein clients approach us to solve certain challenges they may be facing in this area.

We guide our clients on a large array of matters, including – but not limited to – commercial, regulatory and employment advice, to ensure that their business in India is not hampered.

We assist such clients in setting up their business operations in India and continuing with their established businesses. This includes corporate advisory and compliance assistance at the relevant times, as well as making the appropriate filings with the (Indian) Ministry of Corporate Affairs and other regulatory bodies. It is our aim to reduce every potential risk that the client may face while conducting business in India. We also assist our clients in winding up if necessary. In addition, in our role as a full-service law firm, we are further equipped to assist the client with any disputes/litigation that may arise.

Our practice is centered around transactional and legal advisory services concerning day-to-day business, regulatory issues, corporate and governance affairs. We advise on legal issues concerning inbound and outbound investments, strategic alliances, collaborations and corporate restructurings. From M&A (including transactions in the public space) to private equity and joint ventures, we advise clients through all stages of complex and marquee assignments. We also assist our clients in dealing with diverse corporate governance and compliance issues, including FCPA /Anti-Bribery/Anti-Corruption investigations.

We keep a close watch on the contemporary, regulatory and legislative drift in Indian corporate legal trends, and notify our clients on significant updates to ensure they can make well-informed decisions concerning investments and/or setting up and continuing business operations in India.

In addition, we participate in numerous international conferences and networking events annually to ensure that our global advisory scope remains current. It is also important that we organise sector-specific client events, providing a platform for engagement with clients to keep us updated with the expectations of our clientele. To this same end, our lawyers are members of renowned bar associations, such as the International Bar Association and the American Bar Association, among others, which greatly supplements our extensive network. The firm is also a member of the State Capital Group, which provides us access to expertise across 63 countries.

As we believe in sharing our knowledge base, we additionally provide publically accessible insights concerning contemporary Indian legal trends through our publications inclusive of newsletters, blogs, articles and video libraries, which keeps our current and potential clients updated with changes to legal trends. Similarly, we maintain partnerships with reputed online databases, which enables us to keep up to date with the overseas legal landscape.

Indian corporate law is all-encompassing, and should not be considered in isolation of sector-specific legislations – especially in light of soaring FDI in specific sectors, such as technology and IT/ITES. Please see the following examples of recent regulatory/legislative amendments and trends, which are expected to impact investment in the region:

Data Protection
The Indian regulatory landscape concerning data protection is on its way to a complete revamp through the Digital Personal Data Protection Act, 2023 (“DPDP Act”). The DPDP Act is set to impact corporations considerably, requiring them to transition through significant data privacy compliances, primarily reflected through changes to current practices around cross-border data sharing, data storage, as well as notice-consent-related requirements. The DPDP Act, post formulation of rules. will also establish separate judicial infrastructure, facilitating expeditious disposal of data-privacy-related disputes.

Employment Laws
Recent trends indicate that more foreign companies are using the services of Employer of Record (“EOR”), which recruits Indian talent on their behalf. When these foreign companies intend to invest in India but are reluctant to set up operations, they may avail of EOR services, which allow them to engage with Indian talent without as many compliance requirements vis-à-vis incorporating an Indian subsidiary, office or employment laws.

Mandatory Dematerialisation of Securities
The (Indian) Ministry of Corporate Affairs has mandated all private companies (excluding small companies) to facilitate dematerialisation of their existing securities before October 1, 2024. Any issue or allotment of securities by private companies is also mandated to be in dematerialised form from October 2024. While this is a welcome step to ensure transparency, we have observed many investors finding dematerialisation-related compliances burdensome, especially in cases of their transaction period coinciding with the transition period of said compliance.

Technology & Infrastructure
In early 2024, the Indian government approved the establishment of three semiconductor units (some of which are in partnership with Taiwan), allowing the country to develop proficiency in chip fabrication. This will allow for further investments and deal flow in these sectors, particularly in the context of ongoing US-China trade tensions, consequent to which investors across jurisdictions are searching for alternatives for investment.

Abolition of Angel Tax
Through the Union Budget of 2024, the Indian government recently abolished angel tax, which was to be paid by startups on funds raised by angel investors. Specifically, when angel investors received shares higher than the fair market value of those shares, that additional amount would be taxable. Angel tax was highly criticised for its restrictive stance towards startups, and significantly raised the tax implications a startup would face. It is anticipated that this move will attract more investors to the region.

While overall deal activity in India is surging, recent regulatory trends are moving towards ensuring transparency, observably leading to the “ease of doing business” perspective in India being recalibrated from a transparency standpoint. This comes at the cost of stricter compliances for investors, requiring efficient legal and regulatory advice. Advising through shifts in regulatory trends always requires a thorough grip on the cardinals of law, in order to guide investors through the regulatory overhaul in any jurisdiction – and that’s where investors find us. From advisory regarding legal/regulatory concerns, to legal assistance through most complex transactions, we – as a full-service law firm – ace at delivering results. Our publically accessible insights on contemporary legal trends are available to view here: https://www.jsalaw.com/newsletters-and-updates