SHauKeeN GaBRu
Chardi Kala
[FONT=times new roman,new york,times,serif] New York Times Feb. 5 — Many in this nation, which gained independence from Britain in 1947, are discovering that it is far more appealing to belong to a nation doing the takeovers rather than being taken over.
Much of India erupted with jubilation last week when the Tata Group, an Indian conglomerate, won the bidding for the Corus Group, the British-Dutch steel company, with a $11.3 billion offer, the largest acquisition ever by an Indian company.
With the value of overseas bids by Indian companies soaring to $21 billion last year from less than $1 billion in 2000, according to the market researcher Dealogic, an elite slice of this country is growing intoxicated by the fantasy that it may one day own the world.
The takeover of Western companies by Indians is seen by many here as a reversal of fortune: a once-proud civilization that became a colony is now buying out the once-hallowed corporations of the West.
Last month, an Indian newspaper published a front-page drawing of what Times Square could look like if Indian companies went on a global acquisition spree. Stripped from the billboards were American brands. In their place were Indian companies that few Americans have heard of: Videocon, Reliance Industries and Tata.
“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,” said Rahul Kansal, brand director of The Times of India, an English-language daily newspaper that has stoked the takeover euphoria, and whose sibling, The Economic Times, printed the Times Square spread.
Some investors, however, do not seem to share that view. Since talk of the deal began in October, investors have shaved 13 percent from Tata Steel’s market capitalization.
And many question whether Indian companies can manage the difficult and nuanced process of integrating a foreign company into an Indian corporation. The sense of pride began building early last year when an Indian-born steel magnate, Lakshmi N. Mittal, who lives in London, made a hostile bid for Arcelor, the steel maker based in Luxembourg; Mr. Mittal eventually acquired it for $33.5 billion. Though his company was based in the Netherlands, is managed from London and had no mills in India, the Indian government, all the way up to Prime Minister Manmohan Singh, put its support behind the bid. The media lionized Mr. Mittal, much as they now lionize Ratan Tata, the head of Tata.
Since then, as numerous Indian acquisition deals have been announced, a sense of new nationalism has emerged. The Times of India epitomized this feeling with its new marketing campaign, called India Poised, which unabashedly uses patriotism to sell newspapers. On Jan. 26, Republic Day in India, The Times called on Indians to “make public displays of affection for India.”
A recent survey by the Chicago Council on Global Affairs concluded that Indians see their country as second only to the United States in its influence in the world. They also expect the global sway of the United States to wane over the next 10 years as the power of India rises.
Indian companies have some good reasons for their foreign acquisitions. For example, Ranbaxy — which has bought numerous foreign operations, like a European generic drugs business from GlaxoSmithKline — gained a sales force right away and did not have to build one from scratch. For an automaker like Tata Motors, acquiring Daewoo Commercial Vehicle of Korea in 2004 brought in expertise in heavy trucks to an Indian company still producing 1970s style vehicles.
But a small number of large acquisitions have stirred some worries. A United States consulting firm recently warned a small group of the Indian industrialists against repeating the mistakes of Japanese companies that overreached with major acquisitions in the 1980s. The consultant — who requested anonymity for fear of harming the firm’s business relationships — told those leaders how Japanese companies “spiraled into a vicious cycle of losses” after a buying spree left them with corporate and human assets scattered across a world they hardly understood.
Even so, to many Indians, the takeovers may help to move beyond anxieties created during India’s colonial era and four decades of socialism.
“There’s a deep inferiority complex,” said Ramachandra Guha, a prominent historian and social critic. “Sometimes it manifests itself in excessive deference. At the same time, we exalt in cases of success over the white man.”
When Jamsetji Tata, the grandfather of Ratan, sought to stay in a British-run hotel in Mumbai in colonial days when the city was known as Bombay, he was refused because he was an Indian. He resolved to start his own Taj Mahal Hotel, which opened in 1903 with German elevators and English butlers. And now, as a fast-growing hotel chain, the Taj has taken control of Western properties like the Pierre in New York, the W in Sydney and the St. James Court in London.
Back then, some restrictions from the socialist government still lingered, including currency rules so tight that Indian managers could not take clients to lunch in New York, much less acquire companies.
Ratan Tata washed dishes as a college student at Cornell University because what was perhaps India’s richest family could not legally wire him money for food.
Those days instilled in many Indians thrift, caution, fear of the future and insecurity about their standing in the world. And now, in the takeover boom, are portents that as economic fundamentals change, culture changes with them.
“A pulsating, dynamic new India is emerging,” Amitabh Bachchan, a Bollywood actor, says in a television ad for The Times of India. “An India whose faith in success is far greater than its fear of failure. An India that no longer boycotts foreign-made goods but buys out the companies that make them instead.”
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Much of India erupted with jubilation last week when the Tata Group, an Indian conglomerate, won the bidding for the Corus Group, the British-Dutch steel company, with a $11.3 billion offer, the largest acquisition ever by an Indian company.
With the value of overseas bids by Indian companies soaring to $21 billion last year from less than $1 billion in 2000, according to the market researcher Dealogic, an elite slice of this country is growing intoxicated by the fantasy that it may one day own the world.
The takeover of Western companies by Indians is seen by many here as a reversal of fortune: a once-proud civilization that became a colony is now buying out the once-hallowed corporations of the West.
Last month, an Indian newspaper published a front-page drawing of what Times Square could look like if Indian companies went on a global acquisition spree. Stripped from the billboards were American brands. In their place were Indian companies that few Americans have heard of: Videocon, Reliance Industries and Tata.
“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,” said Rahul Kansal, brand director of The Times of India, an English-language daily newspaper that has stoked the takeover euphoria, and whose sibling, The Economic Times, printed the Times Square spread.
Some investors, however, do not seem to share that view. Since talk of the deal began in October, investors have shaved 13 percent from Tata Steel’s market capitalization.
And many question whether Indian companies can manage the difficult and nuanced process of integrating a foreign company into an Indian corporation. The sense of pride began building early last year when an Indian-born steel magnate, Lakshmi N. Mittal, who lives in London, made a hostile bid for Arcelor, the steel maker based in Luxembourg; Mr. Mittal eventually acquired it for $33.5 billion. Though his company was based in the Netherlands, is managed from London and had no mills in India, the Indian government, all the way up to Prime Minister Manmohan Singh, put its support behind the bid. The media lionized Mr. Mittal, much as they now lionize Ratan Tata, the head of Tata.
Since then, as numerous Indian acquisition deals have been announced, a sense of new nationalism has emerged. The Times of India epitomized this feeling with its new marketing campaign, called India Poised, which unabashedly uses patriotism to sell newspapers. On Jan. 26, Republic Day in India, The Times called on Indians to “make public displays of affection for India.”
A recent survey by the Chicago Council on Global Affairs concluded that Indians see their country as second only to the United States in its influence in the world. They also expect the global sway of the United States to wane over the next 10 years as the power of India rises.
Indian companies have some good reasons for their foreign acquisitions. For example, Ranbaxy — which has bought numerous foreign operations, like a European generic drugs business from GlaxoSmithKline — gained a sales force right away and did not have to build one from scratch. For an automaker like Tata Motors, acquiring Daewoo Commercial Vehicle of Korea in 2004 brought in expertise in heavy trucks to an Indian company still producing 1970s style vehicles.
But a small number of large acquisitions have stirred some worries. A United States consulting firm recently warned a small group of the Indian industrialists against repeating the mistakes of Japanese companies that overreached with major acquisitions in the 1980s. The consultant — who requested anonymity for fear of harming the firm’s business relationships — told those leaders how Japanese companies “spiraled into a vicious cycle of losses” after a buying spree left them with corporate and human assets scattered across a world they hardly understood.
Even so, to many Indians, the takeovers may help to move beyond anxieties created during India’s colonial era and four decades of socialism.
“There’s a deep inferiority complex,” said Ramachandra Guha, a prominent historian and social critic. “Sometimes it manifests itself in excessive deference. At the same time, we exalt in cases of success over the white man.”
When Jamsetji Tata, the grandfather of Ratan, sought to stay in a British-run hotel in Mumbai in colonial days when the city was known as Bombay, he was refused because he was an Indian. He resolved to start his own Taj Mahal Hotel, which opened in 1903 with German elevators and English butlers. And now, as a fast-growing hotel chain, the Taj has taken control of Western properties like the Pierre in New York, the W in Sydney and the St. James Court in London.
Back then, some restrictions from the socialist government still lingered, including currency rules so tight that Indian managers could not take clients to lunch in New York, much less acquire companies.
Ratan Tata washed dishes as a college student at Cornell University because what was perhaps India’s richest family could not legally wire him money for food.
Those days instilled in many Indians thrift, caution, fear of the future and insecurity about their standing in the world. And now, in the takeover boom, are portents that as economic fundamentals change, culture changes with them.
“A pulsating, dynamic new India is emerging,” Amitabh Bachchan, a Bollywood actor, says in a television ad for The Times of India. “An India whose faith in success is far greater than its fear of failure. An India that no longer boycotts foreign-made goods but buys out the companies that make them instead.”
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thank ju this may be helpful for my essay :D
