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COMPETITION COMMISSION OF INDIA
Combination Registration No.C-2024/04/1134
4th June 2024
Notice under Section 6(2) of the Competition Act, 2002 filed by Anahera Investment Pte.
Ltd., Bricklayers Investment Pte. Ltd., Chiswick Investment Pte. Ltd., Stretford End
Investment Pte. Ltd., Dagenham Investment Pte. Ltd., IRB Infrastructure Developers
Ltd. and IRB Infrastructure Trust
CORAM:
Ms. Ravneet Kaur
Chairperson
Mr. Anil Agrawal
Member
Ms. Sweta Kakkad
Member
Mr. Deepak Anurag
Member
Order under Section 31(1) of the Competition Act, 2002
1.
On 15th April 2024, the Competition Commission of India (Commission) received a
notice under sub-section (2) of Section 6 of the Competition Act, 2002 (Act) filed by
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Anahera Investment Pte. Ltd. (Anahera), Bricklayers Investment Pte. Ltd.
(Bricklayers), Chiswick Investment Pte. Ltd. (Chiswick), Stretford End Investment
Pte. Ltd (Stretford), Dagenham Investment Pte. Ltd. (Dagenham) [Anahera,
Chiswick, Bricklayers, Dagenham and Stretford are registered in Singapore and
collectively referred to as “GIC Unitholders”], IRB Infrastructure Developers Ltd.
(IRB), and IRB Infrastructure Trust (InvIT) [GIC Unitholders, IRB and InvIT
collectively referred to as “Acquirers”] for the proposed acquisition in IRB
Infrastructure Trust (InvIT) and Meerut Budaun Expressway Limited (MBEL) [InvIT
and MBEL are collectively referred as “Targets”] [Hereinafter, the Acquirers and the
Targets are collectively referred to as the “Parties”].
2.
The notice has been filed pursuant to, inter alia, the Framework agreement dated 15th
October 2022 entered amongst IRB, MBEL and Anahera.
3.
The Proposed Combination involves the following steps:
(i)
Step 1: Proposed subscription to non-convertible debentures (NCDs) of MBEL
by each of IRB and Anahera, respectively (NCD Subscription).
(ii)
Step 2: Proposed fresh issue of units by the InvIT to its existing unitholders
(i.e., each of IRB and one or more of the GIC Unitholders in the InvIT),
following which the unitholding percentage of IRB and GIC Unitholders will
continue to be approximately 51% (approx.) and 49% (approx.), respectively
(Trust Unit Issue).
(iii) Step 3: Proposed acquisition of approximately 80.4% of the equity shares of
MBEL and approximately 80.4% of the NCDs of MBEL by the InvIT. (MBEL
Acquisition).
(iv) Alternate InvIT NCD Subscription: In the event Anahera and IRB are unable to
complete the NCD Subscription under Step 1 for any reason, then:
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The InvIT to acquire approximately 72.42% (as against 80.4%) of the NCDs
of MBEL cumulatively from IRB and Anahera under Step 3 above; and
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The InvIT to additionally subscribe to approximately 7.98% of the NCDs of
MBEL at Step 3 above, such that the InvIT’s aggregate holding of NCDs in
MBEL will stand at 80.4%.
[Step 1, Step2, Step 3 and Alternate InvIT NCD Subscription are collectively referred to
as “Proposed Combination”].
4.
In terms of Regulation 14 of Competition Commission of India (Procedure in regard to
the Transaction of Business Relating to Combinations) Regulations, 2011, certain
information(s)/ clarification(s) were sought vide communication dated 24th April 2024,
inter alia, relating to the activities of the Parties and the response to the same was
received on 30th April 2024.
5.
GIC Unitholders (i.e., Anahera, Bricklayers, Chiswick, Stretford and Dagenham) are
wholly-owned subsidiaries of GIC Infra Holdings Pte. Ltd. (GIC Infra) which, in turn,
is a wholly-owned subsidiary of GIC (Ventures) Pte. Ltd. (GIC Ventures). Each of
the GIC Unitholders are Special Purpose Vehicles (SPVs) organized as a private
limited company in Singapore that is a part of a group of investment holding
companies managed by GIC Special Investments Private Limited (GICSI) (GIC
Group). Both GIC Ventures and GICSI are wholly-owned by the Minister for Finance,
a body corporate established under Section 2(1) of the Minister for Finance
(Incorporation) Act, Chapter 183 of Singapore. GIC Ventures is the ultimate parent
entity of GIC Unitholders. Each GIC Unitholder holds investments and is not itself
engaged in commercial operations in relation to the sale or purchase of goods and
services.
6.
GIC Group has several investment holding companies, which in turn have multiple
portfolio investments across the world. GIC Group cumulatively holds 49% (approx.)
of the units of the InvIT through GIC Unitholders. Further, GIC Group holds 49% of
the equity shares of its Investment Manager, i.e., MMK Toll Road Private Limited
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(IM), through Croxley Investment Pte. Ltd. and 49% equity stake of MBEL and 49%
of NCDs issued by MBEL (through Anahera).
7.
InvIT, is a private trust registered as an infrastructure investment trust (InvIT) with the
Securities and Exchange Board of India. The sponsor and project manager of the InvIT
is IRB, the trustee is IDBI Trusteeship Services Limited and the investment manager is
IM. The unitholding of the InvIT is currently held by IRB (approximately 51%
unitholding) and GIC Unitholders (approximately 49% unitholding). The InvIT holds a
portfolio of toll road assets, operated and maintained pursuant to concessions awarded
by the National Highways Authority of India and certain State concessioning
authorities. The InvIT currently operates 14 road projects. Following the MBEL
Acquisition, MBEL will become the 15th road asset held by the InvIT.
8.
MBEL is an SPV which has been incorporated for the development of the project
involving building, operation and transfer of a six-lane greenfield expressway corridor
of 129.7 km between Meerut and Budaun in Uttar Pradesh. As stated above, GIC
Group (through Anahera) currently holds 49% equity stake of MBEL and 49% of
NCDs issued by MBEL. The remaining 51% equity stake in MBEL along with 51%
NCDs issued by MBEL, is held by IRB. Accordingly, MBEL is currently jointly
owned by two shareholder groups i.e., GIC Group and IRB.
9.
IRB belongs to the IRB promoter group. The ultimate parent company of IRB is IRB
Holding Private Limited, which is the single largest shareholder of IRB. IRB holds
51% in both the Targets. IRB is a roads and highways infrastructure developer
engaged in construction works in engineering, procurement and construction (EPC)
contracts, and providing operation and maintenance (O&M) services over the
concession life of projects won. IRB operates its business through various subsidiaries
and joint ventures. IRB has projects in 12 states in India. IRB also sponsors two
InvITs, each registered under the InvIT Regulations. In addition to the InvIT, IRB is
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also the sponsor of a publicly offered and listed infrastructure investment trust IRB
InvIT Fund (Public InvIT) and owns approximately 16% stake in the Public InvIT. In
addition, IRB has ancillary interests in power generation through wind sources, and the
development and operation of airports.
10. It is submitted in the notice that GIC Group is present in the market for road assets only
through its investment in IRB InvIT, the IM and MBEL and there is no other investee
entity of GIC Group which is directly or indirectly engaged in the market for road
assets. Further, IRB is present in the said market only through its own downstream
affiliates, i.e., the Public InvIT, wholly owned subsidiaries of IRB, the InvIT and
MBEL. Considering the business activities of other downstream affiliates of IRB
engaged in the market for road assets to overlap with the InvIT and/or MBEL, the
competition assessment is provided for the said market as well as the vertical
relationship in the market for O&M of highways in the road infrastructure sector in
India and market for provision of EPC services in the road infrastructure sector in India
at the upstream level and the market for road assets at the downstream level.
11. The Commission decides to leave precise delineation of the relevant market open, as it
was observed that because of the reasons stated below, the Proposed Combination is
not likely to result in appreciable adverse effect on competition irrespective of the
manner in which the relevant market is delineated.
12. Based on the submissions of the Parties, it is noted that the combined market shares of
Parties in the market for road assets on a pan India basis are in the range of [0-5] %, in
terms of volume and in the range of [10-15] %, in terms of value. Further, there are
other players present in the market. With respect to the vertical relationship, it is noted
from the submissions of the Parties that the market shares of the Parties in the markets
at the upstream level are in the range of [0-5] % and these markets are characterised by
