It is often said that carve-outs and minority stakes are quietly leading mid-market activity in India. We could not verify that. The public trackers we reviewed do not break deals out by structure, so the claim cannot be confirmed or refuted from them. This piece covers what the numbers do show, and why each structure carries its own tax and regulatory questions.
What the public data shows
Grant Thornton Bharat counted 2,658 transactions worth USD 133 billion in 2025, up 21% in volume and 13% in value. Within that, M&A was 963 deals worth USD 60.2 billion, up 41% in volume and 36% in value, and PE/VC was 1,506 deals worth USD 37 billion. Fourteen billion-dollar deals made up more than half of M&A value.
For Q2 2026 the same tracker reported 565 M&A and PE transactions worth USD 36.3 billion. M&A was 240 deals; outbound deals were 84% of M&A value and domestic deals 64% of M&A count. Private equity slipped in both volume and value against Q1, with a shift towards fewer, larger deals.
Two things follow. Value is dominated by large deals, so headline totals say little about the mid-market. And none of these figures isolates carve-outs, divestments or minority stakes. Any statement about their share should name its dataset and definition.
Why carve-outs are their own exercise
A carve-out sells a division or undertaking, not a company. In India that is commonly structured as a slump sale, a transfer of one or more undertakings for a lump sum without values assigned to individual assets. Under section 50B of the 1961 Act, the gain is measured against the undertaking's net worth, computed on prescribed rules, and a chartered accountant's report in Form 3CEA certifies that computation. One guide states that the Income-tax Act 2025, in force from 1 April 2026, retains the framework under restructured section numbers. Verify the current section, rates and holding-period rules before modelling any deal.
Practical questions follow: which contracts, licences, employees and liabilities move; whether standalone financials exist for a business that never reported separately; and what transitional services the seller will provide.
Why minority stakes are not "light" deals
A minority investment can carry regulatory weight out of proportion to its size.
- SEBI takeover code. For a listed target, an acquirer reaching 25% of voting rights must consider an open offer. An open offer can also arise below 25% if the transaction gives control through board, veto or contractual rights. Holders at or above 25% may acquire up to 5% more in a financial year without one, subject to conditions.
- Competition law. The CCI's deal value threshold, effective 10 September 2024, makes acquisitions above Rs 2,000 crore notifiable where the target has substantial business operations in India, even if asset and turnover tests are not met. One guide notes the de minimis exemption (Rs 450 crore assets or Rs 1,250 crore turnover) does not apply once that threshold is triggered. Many mid-market deals will sit below these figures, but the same guide notes that a minority stake, a board seat, a budget veto or access to commercially sensitive information can each amount to material influence. Confirm current thresholds before signing.
The point for promoters: the rights attached to a stake often matter more than the percentage.
How to test the claim yourself
- Pick a dataset and a definition, and state both. Carve-out, divestment and minority stake are not fixed categories across trackers.
- Filter by deal size, since averages are skewed by billion-dollar transactions.
- Read the announcements, not only the headlines, and classify each by structure.
- Treat any share you cannot reproduce as a hypothesis.
What to do with this
These are considerations for boards and promoters, not advice on any transaction.
- Before a carve-out, prepare standalone financials, a list of transferring assets, contracts and people, and a tax view on the slump-sale route as of the transaction date.
- Before a minority sale or purchase, map governance rights against the SEBI takeover triggers and CCI material influence, and test whether any filing is required.
- Model the timeline for approvals and consents, since some cannot be closed before clearance.
- Ask advisers to show the source and definition behind any market-trend claim used to justify timing.
This article is journalism and commentary. It is not a recommendation to buy or sell any security, and it is not professional advice. Read the full disclaimer.
