Deal-making is as shoddy a work in the emerging market of India as its umpteen television sops aired to make prime time television viewing an ordeal.
The country’s largest airline Jet Airways recently announced a hurried deal to take over Air Sahara, a relatively new player.
Its now common knowledge that the massive valuation of Air Sahara by Jet, just to keep at bay potential suitors including Vijay Mallya, the desi version of Sir Richard Branson, was never in sync with the ground realities.
Air Sahara is just a riddle, not an airline in the strictest sense. It also operates flights.
So the Rs 180 crore Jet paid to Sahara is now as good as a needle lost in the namesake desert. Of course legal battles lie ahead, which is the price for shoddy deal making.
Now, another cracker of a deal is falling apart -- Mobile telephone service providing firm Hutchison Essar-BPL merger in Mumbai circle.
The same reasons that prompted Jet to go for a hurried, short-sighted deal with Sahara has been the underlying principle of the Huchison Essar-BPL drama also – insecurity.
Jet wanted to consolidate its decent presence in the booming aviation industry. Hutch wanted to catch up its ever-losing battle with Airtel.
A better way of dealing with these ambitions was to fine tune its existing operations by playing up its strength rather than swallowing a weak peer.
Jet and Hutchison Essar failed to realize this and rushed through fancy deals which ony caught the fancy of the dealers and shakers in the media. They eventually ended up where they started and perhaps lost some futile crores.
Corporate India has to understand that management strategies churned out in business schools are not sacrosanct. Ground realities are. If only Naresh Goel and his battery of advisors knew that.
And this laconic oneliner should suit future Hutch ads: wherever you go, deal-making is not as cool as the green grass, blue skies and the pug.
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