Mergers, Acquisitions and Takeovers Case Study

Aditya Birla Acquisition of ASCIL: A Shortcut Entry into Retail Broking?

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Abstract:
Aditya Birla Nuvo (ABN), a diversified conglomerate and a division of the Aditya Birla Group, entered into a strategic agreement to acquire a 56% stake in Apollo Sindhoori Capital Investments Ltd, a retail broking firm based in Chennai, India. The deal is the latest step by Aditya Birla Nuvo, an inorganic growth strategy, to strengthen its financial services business. The deal helps them to enter the retail broking business, which is highly fragmented with many players. It also gives them a trading facility in equity, derivative and commodity. Through this deal, Aditya Birla Nuvo is re-entering the broking business, which the company exited in 2003. This case discusses the rationale of the deal, the strategy behind the acquisition and whether it will work in favour of the ABN.

Pedagogical Objectives:

• To retail broking in India
• To reasons and strategy behind the Aditya Birla Nuvo acquisition of Apollo Sindhoori Capital Investments Ltd
• To whether it will work in its favour

Keywords : Aditya Birla group, Aditya Birla Nuvo, Apollo Sindhoori, Indian broking industry, Retail broking, Major players, Acquisition, Joint venture, FERA (foreign exchange regulation act), SEBI (securities and exchange board of India), Stock market, Economic and financial reforms, Financial services, Competition, Challenges

Contents : 
Retail Broking in India
Major Players in India’s Retail Brokerage Market
Aditya Birla Nuvo: Acquisition of ASCIL
Foreign Exchange Regulation Act (FERA)
Security Exchange Board of India
Apollo Sindhoori Capital Investments Ltd (ASCIL)