1. Paradeep Phosphates Limited (PPL) 2. Mangalore Chemicals & Fertilizers Limited (MCFL) 3. Zuari Maroc Phosphates Private Limited (ZMPPL)

Page 1 of 14 COMPETITION COMMISSION OF INDIA Combination Registration No.C-2024/05/1149 30th July 2024 Notice under Section 6(2) of the Competition Act, 2002 filed by Paradeep Phosphates Limited, Mangalore Chemicals & Fertilizers Limited and Zuari Maroc Phosphates Private 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 17th May 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 Paradeep Phosphates Limited (PPL), Mangalore Chemicals & Fertilizers Limited (MCFL) and Zuari Maroc Phosphates Private Limited (ZMPPL) [PPL, MCFL and Combination Registration No. C-2024/06/1149 Page 2 of 14 ZMPPL are collectively referred to as the ‘Parties’. Further, PPL and MCFL are collectively referred to as the ‘Merging Parties’]. 2. The notice has been filed pursuant to the composite scheme of arrangement by and amongst PPL, MCFL and their respective shareholders and creditors; and the Merger Cooperation Agreement dated 7th February 2024 executed by and between PPL and MCFL. 3. The notice has been filed in relation to: (i) proposed amalgamation of MCFL with and into PPL, on a going concern basis (Proposed Merger); and (ii) proposed acquisition of upto 33.08% shareholding of MCFL by ZMPPL from ZACL, in accordance with and as an integral part of the Scheme (Proposed Acquisition) [together, Proposed Combination]. It is submitted that MCFL will be dissolved without winding-up as MCFL will amalgamate with and into PPL with ZMPPL holding upto 51% (on a fully diluted basis) shareholding in the resulting entity, i.e., PPL. 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 03rd June 2024, and 03rd July 2024 and the responses to the same were received on 18th June 2024 and 8th July 2024, respectively. Further, voluntary submissions were received on 18th July 2024 and 24th July 2024. PPL 5. PPL is a public company incorporated under the Companies Act, 1956. It operates under the broader umbrella and control of the Adventz group of companies (Adventz group). ZMPPL currently holds the majority shareholding in PPL, i.e., 56.08%. The remaining shareholding of PPL is held by public shareholders. PPL does not have any subsidiaries. It has two manufacturing plants located in Odisha and Goa in India. Combination Registration No. C-2024/06/1149 Page 3 of 14 6. PPL is primarily engaged in the manufacture and sale of urea fertilizers, non-Urea/ complex fertilizers, namely, Di-ammonium Phosphate (DAP) and Nitrogen Phosphorus and Potassium (NPK) (multiple grades) fertilizers. PPL also sells a small amount of Muriate of Potash (MoP). Apart from these products, PPL also manufactures and sells small volumes of micronutrient mixtures like zypmite and HFSA (Hexafluoro Silicic Acid). Additionally, PPL produces phospho-gypsum (which is a by-product of the fertilizer manufacturing process) and is largely sold to cement manufacturers for use as raw material. 7. In addition to this, PPL also manufactures and sells small quantities of phosphoric acid, sulphuric acid and Ammonia in the open market. Phosphoric acid, sulphuric acid and Ammonia are intermediary inputs required for manufacturing of fertilizers and are used by PPL for captive consumption. However, if any excess quantity of such intermediary inputs is manufactured, they are sold as-is in the open market. MCFL 8. MCFL is a public company incorporated under the Companies Act, 1956. It operates under the broader umbrella and control of the Adventz group. The majority shareholding (i.e., 54.03%) in MCFL is held by ZACL1. The remaining shareholding is held by the Promoter Group (except ZACL) (6.60%) and Public Shareholders (39.37%). It has a manufacturing plant located in Panambur, Mangalore, Karnataka. 9. MCFL is inter alia engaged in the business of manufacture, purchase, import and sale of fertilizers in India. It is primarily engaged in the production and marketing of urea fertilizers, non-urea fertilizers, namely, DAP, NPK (multiple grades) and MoP in India. In addition, MCFL also manufactures and sells small quantities of sulphuric acid and ammonia in the open market. Sulphuric acid and Ammonia are intermediary inputs required for manufacturing fertilizers and are used by MCFL for captive consumption. 1 The shareholding pattern of ZACL (a company belonging to the Adventz group) is as follows: Promoter Group (65.28%) and Public Shareholders (34.72%). Combination Registration No. C-2024/06/1149 Page 4 of 14 However, if any excess quantity of such intermediary inputs is manufactured, they are sold as-is in the open market. ZMPPL 10. ZMPPL is a private company incorporated under the Companies Act, 1956. It is a 50:50 joint venture between ZACL and OCP S.A. (OCP). ZMPPL currently holds 56.08% equity stake in PPL. ZMPPL carries out trading of fertilizers. It has not made any sales of fertilizers till date, except for certain minuscule sales to PPL and MCFL in March, 2024. Adventz Group 11. The Adventz group is engaged in the agriculture business through ZACL, PPL and MCFL. It offers various services, such as, technical consultancy, project management for chemical, fertilizer and other infrastructure projects. Adventz Group (including Affiliates) is involved inter alia in the following businesses, i.e., (i) real estate services; (ii) engineering procurement and construction activities; (iii) ready-to- assemble furniture; (iv) business of strategic investments; and (v) agri-business. ZACL is the holding company for the agri-business. OCP 12. OCP is the holding company of the OCP group. It was founded in Morocco in 1920 as the Office Chérifien des Phosphates. The Office Chérifien des Phosphates became a joint stock company (société anonyme) in 2008 under the laws of the Kingdom of Morocco and was renamed OCP S.A. The Moroccan state holds 94.12% shareholding in OCP. The remaining shareholding of OCP is held by Infra Maroc Capital, Prev Invest SA, Société d'Aménagement et de Développement Vert, SOCINVEST and Banque Centrale Populaire S.A., a major Moroccan bank. Combination Registration No. C-2024/06/1149 Page 5 of 14 13. OCP is a global player specialized in the mining, refining, processing, manufacturing, commercialization, marketing and development of rock phosphate, phosphoric acid and fertilizers. In India, OCP primarily operates through its 50:50 joint venture with ZACL, i.e., ZMPPL. Further, OCP has 1 subsidiary in India, i.e., OCP Support Services Private Limited (OCP India). OCP India provides market research and analysis services to OCP and does not have any business operations in India. OCP supplies only four products to India, namely: (i) rock phosphate; (ii) phosphoric acid; (iii) DAP; and (iv) Mono-Ammonium Phosphate (MAP). It is stated that OCP has also supplied NPK to India in 2021 and 2022 and is expected to start the supply of Triple Super-Phosphate (TSP) to India in 2024. Identification of Overlaps A. Horizontal Overlap 14. The activities of the parties to the proposed combination overlap primarily in the fertilizer sector. The overlapping products/ services (i.e., products/ services which are identical/ similar in nature) offered by PPL, MCFL, ZMPPL and OCP in India are provided below: I. Overlaps arising from the Proposed Merger 15. At broad level, the Merging Parties exhibit horizontal overlaps in the following relevant product markets: (i) market for manufacture and/ or sale of Urea fertilizers; and (ii) market for manufacture and/ or sale of non-Urea fertilizers. Further, in non- Urea fertilizers, the Merging Parties’ activities exhibit horizontal overlaps at the narrow level in the following relevant product markets: (a) market for manufacture and/ or sale of DAP; (b) market for sale of MoP; and (c) market for manufacture and/