Navigating India’s IT M&A Landscape: The Pivotal Role of Infrastructure Assessment

India’s Information Technology (IT) sector pulses with mergers and acquisitions (M&A) activity, driven by global demand for innovation and digital transformation. Senior leaders and decision-makers rely on firms like LawCrust, a leading hybrid consulting firm, to navigate the complex interplay of management, finance, legal, and technology in IT M&A. A robust infrastructure assessment anchors every successful deal, ensuring scalability, cybersecurity, and seamless integration. This article explores India’s IT M&A landscape as of June 2025, highlighting challenges, strategic imperatives, and the critical role of infrastructure assessment.

Industry Overview: The IT M&A Ecosystem and Infrastructure Assessment

India’s IT M&A market flourishes, with approximately 150 deals valued at $12 billion in 2024, primarily in cloud computing, Software-as-a-Service (SaaS), cybersecurity, and Artificial Intelligence/Machine Learning (AI/ML). Deal sizes typically range from $50 million to $500 million, with mid-market firms attracting strategic buyers and private equity (PE)/venture capital (VC) exits. Infrastructure assessment is a cornerstone of technology due diligence, revealing a target’s scalability and cybersecurity posture key drivers of valuation and integration success. Scalable infrastructure supports post-acquisition growth, while robust cybersecurity mitigates financial and reputational risks.

The IT M&A value chain engages multiple stakeholders: acquirer due diligence teams evaluate financial and operational fit, legal advisors ensure compliance, technology auditors scrutinise system architecture, and cybersecurity consultants conduct penetration testing. Regulators like the Securities and Exchange Board of India (SEBI) and the Ministry of Electronics and Information Technology (MeitY) enforce data privacy and critical infrastructure standards. LawCrust, for instance, integrates these disciplines to streamline due diligence.

Current trends shaping IT M&A include:

• Shift to IP-led acquisitions: Buyers prioritise proprietary technology over services-heavy models.
• Digital resilience post-COVID: Cloud-native, resilient infrastructure commands premiums.
• Mid-market PE/VC exits: Strategic buyouts drive consolidation.
• Global client demands: Secure, scalable delivery is non-negotiable.

Infrastructure assessment validates these capabilities, ensuring alignment with strategic goals.

1. Recent Developments in IT M&A (June 2025)

As of June 2025, India’s IT M&A landscape reflects global investor enthusiasm, particularly for cloud and SaaS firms with scalable infrastructure and strong cybersecurity. Key developments include:

• M&A rebound: Global tech investors target India’s cloud and SaaS firms, prioritising scalable infrastructure and cybersecurity compliance.
• SEBI’s eased norms: Updated regulations simplify capital flows for cross-border tech buyouts.
• CERT-In mandates: Cybersecurity audits are now mandatory for M&A involving critical infrastructure or SaaS exports, reinforcing infrastructure assessment.
• Talent-driven premiums: Firms with scalable infrastructure and robust data security frameworks command higher valuations amid a talent crunch in AI and cloud.
• Budget 2025 incentives: Tax sops for IP-driven M&A encourage acquisitions of proprietary technology, validated through infrastructure assessment.

LawCrust’s expertise in navigating these trends ensures clients capitalise on opportunities while mitigating risks.

2. Key Challenges in IT M&A

IT M&A in India faces significant hurdles, many tied to infrastructure:

• Legacy tech debt: Outdated infrastructure hampers scalability, increasing integration costs. Infrastructure assessment uncovers these liabilities.
• Hidden security gaps: Non-compliance with India’s Digital Personal Data Protection (DPDP) Act, GDPR, or HIPAA risks deal failure.
• Overstated scalability claims: Pitch decks often exaggerate infrastructure capacity, which infrastructure assessment validates.
• Integration risks: Poorly documented infrastructure delays post-deal synergies.
• Vendor lock-ins: Over-reliance on single vendors limits flexibility.

LawCrust’s rigorous infrastructure assessment process mitigates these risks, ensuring informed decision-making.

3. Strategic Implications: A Hybrid Consulting Approach

A hybrid consulting lens, as exemplified by LawCrust, integrates management, finance, legal, and technology expertise to optimise IT M&A:

• Due Diligence & Infrastructure Assessment

1. Conduct deep tech audits to validate cloud readiness, disaster recovery, load balancing, and API scalability.
2. Perform penetration testing to assess cybersecurity resilience.
3. Verify IP ownership of infrastructure tools, DevOps pipelines, and proprietary software.
4. Review compliance with data storage and processing laws (DPDP Act, GDPR).

• M&A Structuring & Valuation

1. Discount valuations for high tech debt; assign premiums for containerised, microservices-based infrastructure.
2. Use hybrid deal structures with earn-outs tied to scalability milestones.

• Post-Merger Integration

1. Develop a 100-day plan for infrastructure migration, cloud optimisation, and security patching.
2. Deploy AIOps for proactive monitoring and seamless integration.

• Legal & Compliance

1. Secure vendor contracts for infrastructure continuity.
2. Draft cyber indemnities to protect against undisclosed vulnerabilities.
3. Ensure alignment with GDPR, DPDP Act, and industry-specific data laws.

LawCrust integrated approach ensures infrastructure assessment drives value at every stage.

Illustrative Examples

• Scalability Win: A mid-size SaaS firm, assessed by LawCrust, demonstrated 40% infrastructure scaling headroom via infrastructure assessment, justifying a 20% valuation premium.
• Cybersecurity Pitfall: A BFSI tech acquisition faltered when LawCrust infrastructure assessment revealed API vulnerabilities, leading to a restructured deal with escrow and remediation.
• Regulatory Failure: A cloud provider’s acquisition stalled when infrastructure assessment uncovered DPDP Act non-compliance, requiring costly data migration to close the deal.

Conclusion: Infrastructure Assessment as a Non-Negotiable

For senior leaders in India’s IT sector, infrastructure assessment is indispensable in IT M&A. It ensures scalability, strengthens cybersecurity, and drives seamless integration, unlocking deal value while mitigating risks. Firms like LawCrust empower decision-makers to navigate this complex landscape, leveraging hybrid expertise to secure India’s digital future. Prioritise infrastructure assessment to transform M&A opportunities into lasting success.

About LawCrust

LawCrust Global Consulting Ltd. delivers cutting-edge Hybrid Consulting Solutions in Management, Finance, Technology, and Legal Consulting to ambitious businesses worldwide. Recognised for our cross-functional expertise and hybrid consulting approach, we empower startups, SMEs, and enterprises to scale efficiently, innovate boldly, and navigate complexity with confidence. Our services span key areas such as Investment Banking, Fundraising, Mergers & Acquisitions, Private Placement, and Debt Restructuring & Transformation, positioning us as a strategic partner for growth and resilience. With an integrated consulting model, fixed-cost engagements, and a virtual delivery framework, we make business transformation accessible, agile, and impactful.

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