It could have been just another reception in another country, the likes of which punctuate the programmes of visiting heads of state. Prime Minister Atal Bihari Vajpayee was to be feted by a delegation of Italian industry. As Vajpayee reached the venue, his usually sombre face lit up with some amusement and pride. Receiving him, as the head of the Italian delegation was a familiar face: Videocon Chairman Venugopal Dhoot known in Italy as the owner of Nikki Compressori. That was the summer of 2000. On his forthcoming visit to Thailand, the prime minister could yet again meet Dhoot as part of a Thai delegation.

RATAN TATA Chairman, Tata Sons

"We must acquire to ensure we are not dependant on India alone."

ACQUISITION Tetley Plc for $470 m. Tie-ups with Gemplex, MG Rover.

AGENDA Expand markets, acquire assets like Daewoo Motors truck plant and de-risk the group from the Indian cycle.

By the end of the year Dhoot hopes to acquire Thai CRT, one of the world's largest television picture tube makers. Not just that. Dhoot is also shopping for capacities in motors, compressors and glass shells. "We plan to be the backbone suppliers of components for consumer durables worldwide. You have seen the 'Intel Inside' badges on computers and soon you could be seeing 'Videocon Inside' badges on most durables," says Dhoot.

Videocon is but one of many Indian groups shopping for foreign companies. Indeed, 2003 has seen the biggest ever rush of corporates acquiring foreign tags. Kumar Mangalam Birla, son of India's first transnational CEO Aditya Vikram Birla, for instance, has acquired four companies, including two copper mines in Australia and a manufacturing unit in China. Birla has earmarked Rs 600 crore just for acquisitions. His ultimate aim: to control much of the raw resource in non-ferrous metal production and blend Indian skills with better tech to be globally competitive.

V.C. Burman of Dabur India on the other hand is looking to expand his markets and has acquired three companies in less than six months in the UAE and Bangladesh. These outfits are expected to help Dabur reach new markets. Similarly Amtek Auto has acquired Smith Jones Inc of the USA to get a peek at the world's biggest auto market while Wipro has acquired NerveWire, whose clients include Cisco Systems, besides 40 client relationships to front-end their consultancy expertise. These are just some of the success stories. Mergers & Acquisitions Service of the Centre for Monitoring Indian Economy reports that in eight months this year, Indian groups acquired 31 foreign firms.

And these are the ones that came through. An equal number of deals have either been dumped or lie stalled, even lost to the opposition. Ask the consultants and investment bankers. Anyone worth his MBA is working on some acquisition deal or the other. Says Premal Parekh, partner and head of M&A, Ernst & Young: "Every infotech company and pharma outfit out there is looking to acquire a foreign company." In fact, Hemendra Kothari, who has clinched his share of the 31 deals, believes "it is an evolving trend. Don't mistake it for a fashion. Almost every player is in it for a value proposition."

KUMAR MANGALAM BIRLA Chairman, A.V. Birla

"We are aggressively pursuing a global acquisitions plan."

ACQUISITION Straitis Pty & Mount Gordon, Australia. Akzo Nobel, Indonesia. Liaoning Carbon Black, China.

AGENDA Acquire targets that will enable the group to control prices of raw resources and products and thus leverage leadership position in the global markets.

To get a perspective consider some of the deals being looked at by Indian companies in the global mergers and acquisitions bazaar. Shashi Ruia, chairman of the Essar Group, is calculating the downside of acquiring a 3 MT steel plant in Thailand. His aim: control of capacity and a share of the Chinese and asean markets. Anand Mahindra lost the bid to acquire Finnish tractor maker Valtra Corporation to Agco Corporation. The managing director of Mahindra and Mahindra is scouting for a tractor plant in Europe because he believes the M&M can repeat the US success story. Ratan Tata, who has set the commodity markets of tea and steel on fire with the Tata brands, is trying to acquire the truck plant of Daewoo Motors and a car plant Thailand. This would help Tata Motors, already in the European markets, to shift into higher gears and get a foothold in south-east Asia.

And there are many more. In fact, for the first time private equity managers and investment bankers are chasing Indian companies, willing to bankroll any acquisition or investment as they believe Indian firms now have both the management mantra and the skill to turn around enterprises. Very simply, Indian companies are now believed to be creators of wealth. More interesting is the fact that investment bankers are bringing deals to Indian corporates asking them to partner companies in erstwhile iron-curtain countries and places such as Azerbaijan.

Vijay Kelkar, adviser to the finance minister, describes the phenomenon simply as "the signature of a maturing economy". Arun Maira, chairman, Boston Consulting Group, agrees, "You could say Indian transnationals are taking their first adult steps." But adolescence has not been easy. They have gone through the pain of creative destruction and emerged competitive.

AZIM PREMJI Chairman, Wipro

"The potential for strategic acquisitions is much greater now."

ACQUISITION American Management Systems and NerveWire in the US.

AGENDA Use opportunistic buyouts to ramp up revenues, seek high-end consulting and bid for large BPO orders.

Munesh Khanna, MD, Rothschild, reveals that "Indian companies have learnt the virtues of efficiency both in operations as also resources allocation and don't part with cash easily." So much so that Finance Minister Jaswant Singh has complained corporate India is sitting on over Rs 40,000 crore in cash surplus. He has reason. Helping them along was the improvement in forex reserves (now approaching $90 billion) and a low inflation regime that afforded easy interest rates. Add easier norms with a $100 million (Rs 460 crore) limit. Sure Indian companies may not yet be hitting headlines in the M&A space. Some even argue that the acquisitions are low-cost and puny. But it is the trend that is significant. Besides, what is important is the value proposition that they are targeting.

Also there are built-in handicaps. While money may be available and credit easy, unless you are an infotech major or a pharma enterprise covered by the guideline on intellectual enterprises, overseas acquisitions still need permissions. Translated: despite all the talk of liberalisation of the capital account, non it-pharma companies looking at big-tag acquisitions have to walk the babu-maze. As the managing director of a large company reveals, "Competition begins at home as you are required by some peculiar logic to reveal the target of acquisition. This information is not only leaked out to competitors but could also be used profitably in the stock market." Worse, some acquisitions are subject to government approval.

Despite the handicaps India Inc is playing hardball. Winning and even losing seems to be a strategy. Mahindras let go of the Finnish tractor outfit as US major Agco quoted 600 million euros against M&M's bid of 350 million euros. Its game plan could well be to bleed Agco, a competitor in the US market. Clearly it is not all about money. Indian companies are serious players and are playing for the long term.

HABIL KHORAKIWALA Chairman, Wockhardt

"Acquisitions help us leap frog into a new orbit of markets."

ACQUISITION CP Pharma, Wales, UK Wallis Laboratories, UK

AGENDA Expand markets in Europe and the US to access customers, both for generic and OTC medicine.

Maira explains that when you go out to acquire you get assets, brands, distribution, market share, manufacturing resources and talent. For instance, when Tatas got Tetley they got a brand, a distribution network, experienced people and market share.

To get a feel of the acquisition strategies of Indian companies look at the sectors. Traditionally, Indian software firms positioned themselves as low-cost subcontractors. Today they are looking for software and consultancy firms for brand recognition and to move up the value chain (read higher fees). International consultants Gartner says by next year almost all Fortune 500 companies will go for offshore outsourcing. Getting a front end will clearly help byte some of the action. Wipro's acquisition of American Management Systems, for instance, could bring in a large chunk of the global energy practice business.

In pharma, in markets like the UK, two-thirds of the business are in generics. Indian companies have more than proved their competitiveness in this sector. Add the scenarios and quite obviously Indian firms needed to broach new markets. Like Wockhardt. Its acquisition of CP Pharma allows it access to markets for its generic drugs, injectibles facilities and a chunk of the over-the-counter medicines made for superstores like Boots and Sainsbury's. Wockhardt now earns over 50 per cent of its revenue from overseas operations. No wonder almost everyone in it and pharma is out with a shopping bag. Khanna reveals that his firm spends nearly 25 per cent of its time on acquisition strategies. Investment banker Vimal Bhandari of the IL&FS believes this is only to be expected. Given their competitiveness "the transition from exporters to transnationals was only natural".

But it isn't just pharma, it companies or auto-component makers who are in the market. The Tatas-whose acquisition of Tetley at $460 million is the largest as yet-the Birlas, Ruias, Ambanis and the Mahindras are among the big hunters out there. Yes, they want to acquire companies to gain access to new markets, brands, technologies, assets and people. But they also want to move beyond boundaries. Bhandari calls it a "strategic shift to de-risk their growth strategy". Very simply after six years of downslide and pain, companies want to spread their risks.

So when the usually mild-mannered Ratan Tata says, "We must ensure that we are not dependent on India and expand beyond India," it is really a predatory growl. India Inc has begun marking territory in the global jungle. Vajpayee may well get used to being received by Indian tycoons in foreign delegations when he goes abroad.

with Stephen David and Amarnath K. Menon