1. JSW Energy Limited   2. JSW Thermal Energy One Limited

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Page 1 of 7 COMPETITION COMMISSION OF INDIA Combination Registration No.C-2025/01/1233 04th March 2025 Notice under Section 6(2) of the Competition Act, 2002 filed by JSW Energy Limited and JSW Thermal Energy One Limited 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 20th January 2025, the Competition Commission of India (Commission) received a notice under sub-section (2) of Section 6 of the Competition Act, 2002 (Act) filed by JSW Energy Limited (JSWEL) and JSW Thermal Energy One Limited (JSW Thermal) [hereinafter, JSWEL, and JSW Thermal are collectively referred to as ‘Acquirers’]. 2. The notice has been filed pursuant to (i) letter of intent dated 13th January 2025 issued by KSK Mahanadi Power Company Limited (KMPCL / Target) and counter-signed by JSWEL and (ii) the Resolution Plan submitted to the Committee of Creditors [hereinafter, JSWEL, JSW Thermal, and KMPCL are collectively referred to as ‘Parties’]. Combination Registration No. C-2025/01/1233 Page 2 of 7 3. The proposed transaction involves the ultimate acquisition of 100% shareholding and sole control over KMPCL which is currently undergoing insolvency resolution proceedings initiated under the Insolvency and Bankruptcy Code, 2016 (IBC) by JSWEL (through JSW Thermal). The proposed transaction will be undertaken through various inter- connected steps as explained below.: (i) Step 1 (Fund infusion by BidCo into KMPCL): JSWEL has incorporated a wholly owned subsidiary i.e., JSW Thermal as the BidCo (as defined in the Resolution Plan). The BidCo is a special purpose vehicle incorporated for the purposes of the Proposed Combination. Within 90 days of the receipt of the approval of the Hon’ble National Company Law Tribunal (NCLT) at Hyderabad, the BidCo will subscribe to 50,000 equity shares of KMPCL for a subscription amount of INR 5,00,000 (Indian rupees five lakhs only). (ii) Step 2 (Capital reduction of KMPCL): Upon completion of Step 1, KMPCL will undertake a capital reduction process whereby the issued equity share capital of KMPCL held by the shareholders of KMPCL (including any part of the Financial Creditor Debt1 which has been converted to equity) and any right to subscribe to, or be allocated such equity shares, including any employee stock options, pre-emptive subscription rights or convertible instruments held by any person will be entirely cancelled or extinguished, except the equity shares issued to the BidCo in Step 1. In other words, upon completion of Step 2, 100% of the shareholding in KMPCL will be held by the BidCo. (iii) Step 3 (Merger of BidCo with and into KMPCL): BidCo will merge with and into KMPCL such that KMPCL is the surviving entity. The merger of BidCo with and into KMPCL will be subject to the approval of the NCLT. The scheme of arrangement to undertake the merger of BidCo with and into KMPCL is enclosed as Schedule 15 to the Resolution Plan. Upon completion of Step 3, 100% of the shareholding in KMPCL will be held by JSWEL. As such, the 1 “Financial Creditor Debt” refers to the claims submitted by Financial Creditors, amounting to INR 3,22,34,58,20,196.62, of which INR 2,94,60,05,65,013.88 has been verified and admitted by the Resolution Professional (RP) as financial debt. This will also include any interest accrued from the Insolvency Commencement Date, as determined by the Committee of Creditors (CoC). Combination Registration No. C-2025/01/1233 Page 3 of 7 purpose of this merger is solely to facilitate the overall acquisition by JSWEL and for JSWEL to ultimately hold 100% shareholding in KMPCL. (iv) Step 4 (Issuance of shares of KMPCL to the Equity Receiving Creditors2): KMPCL will issue approximately 17,567 equity shares of KMPCL to the Equity Receiving Creditors such that the Equity Receiving Creditors will hold 26% shareholding in KMPCL, on a fully diluted basis. At this stage, JSWEL will hold 74% in KMPCL (i.e., the remaining shareholding). (v) Step 5: (Put and Call Option in relation to shares held by Equity Receiving Creditors): Any time after the expiry of 1 year from the Closing Date but before 5 years from the Closing Date, JSWEL shall acquire the remaining 26% shareholding in KMPCL from the Equity Receiving Creditors through a mutual put/ call option as envisaged in the Resolution Plan: a. Put Option: The Equity Receiving Creditors can invoke the put option to sell all their respective equity shares (i.e., 26% shareholding in KMPCL) to JSWEL. b. Call Option: JSWEL can invoke the call option to buy all the respective equity shares (i.e., 26% shareholding in KMPCL) held by the Equity Receiving Creditors3. (Step 1 to Step 5 are collectively referred to as the ‘Proposed Combination’). 4. In accordance with Regulation 14(2) of the Competition Commission of India (Combinations) Regulations, 2024, vide letter dated 31st January 2025, certain information(s)/ clarification(s) was sought from the Acquirers and complete response to the same was received on 10th February 2025. 5. JSWEL is a public company present across the value chains of the power sector with diversified assets in power generation, transmission and trading. Presently, through its subsidiaries, JSWEL is engaged in power generation, power transmission, power 2 Equity Receiving Creditors (in the context of the Notice) means the secured “Assenting Financial Creditors” of the Corporate Debtor (as defined in the Resolution Plan) excluding (i) financial creditors who are creditors by virtue of the Corporate Debtor being a guarantor for the debt taken by any of the special purpose vehicles of KMPCL; and (ii) creditors who have issued NFB Instruments (as defined in the Resolution Plan) which are to be taken over by the successful resolution applicant in accordance with the Resolution Plan. 3 Clause 3.3.25 (c) of the Resolution Plan Combination Registration No. C-2025/01/1233 Page 4 of 7 trading, coal mining, and power equipment manufacturing. It also operates outside India through subsidiaries incorporated in Mauritius and South Africa. 6. JSW Thermal is a newly incorporated entity and a 100% subsidiary of JSWEL. It currently does not have any business activities. JSWEL and JSW Thermal are part of the ‘JSW group’. 7. JSW group refers to the JSW group of companies headed by Mr. Sajjan Jindal in the capacity of Chairman and includes JSW Steel Limited, JSW Cement Limited, JSW Paints Limited, JSWEL, JSW Infrastructure Limited, JSW Ventures, and JSW Sports along with their respective subsidiaries and affiliates. JSW group has presence in various sectors including steel, energy, infrastructure, cement, paints, venture capital, realty and sports. 8. KMPCL was incorporated in 2009 and is involved in the business of generation and sale of power. Currently, KMPCL is generating and supplying power through its thermal power plant situated at Jangir-Champa District, Chhattisgarh. KMPCL has presence / sales in India through Sai Power Private Limited, KSK Water Infrastructures Private Limited and Raigarh Champa Rail Infrastructure Private Limited. KMPCL does not have business activities outside India. 9. It is submitted in the notice that for the purpose of the Proposed Combination, the Parties have undertaken an overlap assessment between JSWEL, JSW Thermal and the overall JSW Group (including their portfolio companies that meet the Materiality Threshold4 and have presence / sales in India) vis-à-vis KMPCL (including each of their affiliates that meet the Materiality Threshold). 10. It is stated in the notice that JSWEL (including some of its downstream affiliates) and Target i.e., KMPCL, are both engaged in the market for generation of power in India i.e., Power Generation Market. The Parties have submitted that for the purpose of assessment of the horizontal overlaps the relevant market at the broad level may be 4 The entities other than those in which the Parties have (a) less than 10% shareholding / voting rights, (b) no right of representation in the board of directors as a director or an observer; and (c) no right to access commercially sensitive information of the Parties (Materiality Threshold) Combination Registration No. C-2025/01/1233 Page 5 of 7 defined as ‘the market for generation of power in India’ (Power Generation Market) which may be further delineated at a narrower level as ‘the market for generation of power through non-renewable sources in India’ (Non-Renewable Energy Segment) and at the narrowest level as ‘the market for generation of power through thermal energy (using coal) in India’ (Thermal Energy Segment). The Power Generation Market, Non-Renewable Energy Segment and Thermal Energy Segment are collectively referred to as ‘Relevant Power Generation Markets and Segments’ 11. The Parties have stated that there are no existing vertical relationships directly between the Acquirers vis-à-vis the Target in India. However, the Parties’ have identified the following vertical relationships between the portfolio companies of the JSW group and the Target: (i) Vertical relationship between one of the downstream affiliates of the JSW group, i.e., Barmer Lignite Mining Company Limited (BLMCL) engaged in the business of mining and supply of lignite, which is used in thermal power plants for electricity generation, and the Target, which is engaged in the market for generation of power (specifically thermal power) in India and can potentially utilize the lignite supplied by BLMCL. Accordingly, there is a potential vertical overlap between BLMCL and the Target. The relevant upstream and downstream markets for this potential vertical relationship are identified as ‘the market for mining and supply of lignite in India’ (Lignite Market) at the upstream level and Thermal Energy Segment at the downstream level (Potential Vertical Relationship 1). (ii) Vertical relationship between one of the downstream affiliates of JSWEL i.e., JSW Power Trading Company Limited (JSW Power)5, which holds a trading license issued by the Central Electricity Regulatory Commission and is engaged in the business of trading of power in India, and the Target, which is engaged in the market for generation of power (specifically thermal power) in India. This may enable JSWEL to procure and trade the power generated by the Target in India (through its trading platform). Accordingly, there is a potential vertical 5 JSWEL holds 100% shareholding in JSW Power Trading Company Limited. Combination Registration No. C-2025/01/1233 Page 6 of 7 overlap between JSW Power and the Target. The relevant upstream and downstream markets for this potential vertical relationship are identified as Thermal Energy Segment at the upstream level and ‘the market for trading of power in India’ (Power Trading Market) at the downstream level (Potential Vertical Relationship 2). (iii) Vertical relationship between one of the downstream affiliates of the JSWEL, Jaigad Power Transco Limited, which is involved in the business for transmission of power in India (specifically operates two transmission projects in the Ratnagiri district of Maharashtra: (a) Jaigad - New Koyna Transmission Line; and (b) Jaigad - Karad Transmission Line), and the Target, which is engaged in the business of power generation in India (specifically operating a thermal power plant in Janjbir-Champa district, Chhattisgarh). The relevant upstream and downstream markets for this potential vertical relationship are identified as Thermal Energy Segment at the upstream level and the market for transmission of power in India (Power Transmission Market) at the downstream level (Potential Vertical Relationship 3). 12. The Commission decides to leave precise delineation of the relevant market open, as it is 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. 13. Based on the submissions of the Parties, it is noted that the individual and combined market shares of the Acquirers and Target in Relevant Power Generation Markets and Segments are in the range of [0-5]% in terms of installed capacity and [5-10]% in terms of value. Further, there are other players present in the each of the markets. Accordingly, it appears that the Proposed Combination is not likely to raise competition concern in any of the relevant markets. 14. Further, based on the submissions of the Parties, it is noted that there are no existing vertical relationships directly between the Acquirers vis-a-vis the Target in India. There are only potential vertical relationships between certain portfolio companies of the JSW Combination Registration No. C-2025/01/1233 Page 7 of 7 group and the Target. With respect to each of the three potential vertical relationships identified in the notice, it is noted that the market shares of the Parties in the upstream and downstream markets are not significant and there are other players posing competitive constraints on the Parties. Accordingly, it appears that the Proposed Combination is not likely to raise competition foreclosure concerns in any of the relevant markets identified above. 15. Considering the material on record, including the details provided in the notice and the assessment of the Combination based on the factors stated in sub-Section (4) of Section 20 of the Act, the Commission is of the opinion that the Combination is not likely to have appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act. 16. This order may stand revoked if, at any time, the information provided by the Acquirers is found to be incorrect. 17. The information provided by the Acquirers shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act. 18. The Secretary is directed to communicate to the Acquirers accordingly.