2452991 Ontario Limited 2743298 Ontario Limited

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Page 1 of 7 COMPETITION COMMISSION OF INDIA Combination Registration No.C-2023/08/1046 20th September 2023 Notice under Section 6(2) of the Competition Act, 2002 jointly filed by 2452991 Ontario Limited and 2743298 Ontario Limited CORAM: Ms. Ravneet Kaur Chairperson Mr. Anil Agrawal Member Ms. Sweta Kakkad Member Order under Section 31(1) of the Competition Act, 2002 1. On 1st August 2023, the Competition Commission of India (Commission) received a notice under sub-section (2) of Section 6 of the Competition Act, 2002 (Act), filed by 2452991 Ontario Limited (OTPP 1) and 2743298 Ontario Limited (OTPP 2) [OTPP 1 and OTPP 2 are collectively referred to as „Acquirers‟]. 2. The notice has been given pursuant to: (i) resolution dated 6th July 2023 passed by the board of directors of Highway Concessions One Private Limited (HC One/Investment Manager); (ii) draft letter of offer dated 7th July 2023 filed by Highways Infrastructure Trust (Target Trust) with Securities Exchange Board of India (SEBI) in connection with the Rights Issue (Draft Offer Letter); (iii) board resolution dated 26th July 2023 passed by OTPP 1; (iv) HC One Subscription Agreement (HC One SSA) entered into by OTPP 1 on 20th April 2022 read with HC Combination Registration No. C-2023/08/1046 Page 2 of 7 One Share Subscription Agreement Letter Agreement (HC One SSA Letter Agreement) dated 29th July 2023 entered into between OTPP 1, OTPP 2 and HC One which extends and amends the HC One SSA [Hereinafter, the Target Trust and HC One are collectively referred to as „Targets‟ and the Acquirers, Target Trust and HC One are collectively referred to as „Parties‟]. 3. The proposed combination pertains to the acquisition of (i) up to approximately 20% of the unitholding of Target Trust by OTPP 1, taken together with the existing unitholding of OTPP 1 in the Target Trust; and (ii) approximately 20% equity share capital of HC One by OTPP 2 [Step (i) and (ii) 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 (Combination Regulations), the Commission, vide communication dated 23rd August 2023, sought certain information(s)/clarification(s), inter alia, relating to the activities of the Parties and the response to the same was received on 30th August 2023. Further, the Acquirers provided certain information(s) through their additional voluntary submission dated 5th September 2023. Description of the Parties 5. OTPP 1 - OTPP 1 is an investment holding company. It currently owns 7.51% unitholding in the Target Trust. OTPP 1 does not carry out any business operations in India or worldwide. Further, the OTPP 1 does not have any direct or indirect subsidiaries or any registered office in India. 6. OTPP 2 - OTPP 2 is an investment holding company. Currently, it has 60% stake in Green Energy Infra Project Managers Private Limited (Green Energy), which is a newly incorporated Indian entity that is yet to commence operations and currently does not hold any assets. OTPP 2 does not carry out any business operations in India Combination Registration No. C-2023/08/1046 Page 3 of 7 or worldwide. Further, OTPP 2 does not have any direct or indirect subsidiaries or any registered office in India. 7. OTPPB- The Acquirers are solely controlled by Ontario Teachers‟ Pension Plan Board (OTPPB). OTPPB is concerned with the administration of pension benefits and the investment of pension plan assets of active and retired teachers in the Canadian province of Ontario. OTPPB is jointly sponsored by the Government of Ontario and the Ontario Teachers‟ Federation, a professional organization established by the Government of Ontario, of which all teachers in publicly funded schools in the Province of Ontario are members. OTPPB invests in more than 50 countries in a broad array of assets including public and private equities, fixed income, credit, commodities, natural resources, infrastructure, real estate and venture growth. OTPPB and its affiliates1 have following investments in the operation of road concessions in India: (i) Investment in National Highways Infra Trust (NHIT) pertaining to different geographical areas and national highways (NHIT Road Assets), and (ii) Investment in National Investment and Infrastructure Fund (NIIF) (and its investment manager National Investment and Infrastructure Fund Limited (NIIFL)) pertaining to different geographical areas and national highways (NIIF Road Assets) [NHIT Road Assets and NIIF Road Assets are collectively referred to as OTPPB Road Assets]. 8. Target Trust - The Target Trust is an Indian infrastructure investment trust registered with SEBI under the SEBI (Infrastructure Investment Trusts) Regulations, 2014 (SEBI InvIT Regulations). The Target Trust proposes to invest in road infrastructure assets and is sponsored by Galaxy Investments II Pte. Ltd. (Galaxy II). The Target Trust owns the following special purpose entities incorporated in India, engaged in the business of operating (through governmental concessions) roads and highways in India: (i) Nirmal BOT Limited; (ii) Dewas Bhopal Corridor Private Limited; (iii) Godhra Expressways Private Limited; (iv) Jodhpur Pali Expressway Private Limited; (v) Shillong Expressway Private Limited; (vi) Ulundurpret Expressways Private 1 Investee entities of OTPPB having presence in India where the shareholding of OTPPB is above 5% (also referred to as Portfolio Entities) Combination Registration No. C-2023/08/1046 Page 4 of 7 Limited. (Collectively, referred to as the G6 Assets). Additionally, the road assets which may be offered to/acquired by the Target Trust are: (i) HG Assets2, which means the following special purpose entities incorporated in India, engaged in the business of operating (through governmental concessions) roads and highways in India: (a) H.G. Ateli Narnaul Highway Private Limited; (b) H.G. Rewari Ateli Highway Private Limited; (c) H.G. Rewari Bypass Private Limited; and (d) Gurgaon Sohna Highway Private Limited; (ii) Navayuga Udupi Tollway Private Limited (NUTPL)3; (iii) Bangalore Elevated Tollway Private Limited (BETPL)4; and (iv) Gujarat Road and Infrastructure Company Limited (GRICL) and Swarna Tollway Private Limited (STPL) (GRICL and STPL are collectively referred to as Macquarie Assets5). (The G6 Assets, the HG Assets, NUTPL, BEPTL and the Macquarie Assets are collectively referred to as Target Road Assets). 9. HC One - HC One is a private limited company incorporated in India. It is the investment manager of the Target Trust, whose objective is to manage and operate roads assets held directly or indirectly by the Target Trust. It undertakes activities in accordance with the SEBI InvIT Regulations, including making investment decisions with respect to the underlying assets/projects of the Target Trust and overseeing the activities of the project manager of the Target Trust with respect to compliance with the SEBI InvIT Regulations and the project management agreement entered into by it. 2 Target Trust has entered into a share purchase agreement dated 3rd May 2023 with H.G. Infra Engineering Limited (H.G. Infra) in relation to the acquisition of 100% of the equity shareholding of the HG Assets (in one or more tranches). The HG Assets are situated in the state of Haryana with total length of approximately 100 km. 3 Target Trust has entered into a share purchase agreement dated 30th March 2023 in relation to the acquisition of 100% equity shareholding and management control in NUTPL owned by Navayuga Road Project Private Limited and Navayuga Engineering Company Limited in one or more tranches. 4 Galaxy II currently holds 76% of the equity share capital of BETPL. The remaining 24% of the equity share capital of BETPL (Balance Stake) is held by IL&FS Engineering and Construction Company Limited (IECCL) for and on behalf of Maytas Investment Trust (MIT). Galaxy II has entered into a Securities Subscription Cum Purchase Agreement dated 28th September 2022, with BETPL, IECCL and MIT for acquisition of the Balance Stake. 5 Target Trust has entered into definitive documents to acquire between 51% and 83.61% equity shareholding in GRICL from MAIF Investments India Pte. Ltd. and other shareholders of GRICL, and 100% equity shareholding in STPL from MAIF Investments India 3 Pte. Ltd., subject to the conditions precedent specified in the share purchase agreement entered into in this regard. Combination Registration No. C-2023/08/1046 Page 5 of 7 HC One is a wholly owned subsidiary of Galaxy II which is a 100% subsidiary of Galaxy Investments Pte. Ltd. which in turn is majority owned and controlled by KKR Asia Pacific Infrastructure Holdings Pte. Ltd. Galaxy II is affiliated with funds, vehicles and/or entities managed and/or advised by affiliates of KKR & Co. Inc. Further, HC One does not have any direct or indirect subsidiaries, other than HC One Project Manager Private Limited (which is the project manager of the Target Trust). Also, HC One does not have any activities outside India. Identification of Overlaps: 10. The Acquirers have submitted that they have conducted the overlap assessment between the Acquirers and the group to which the Acquirers belong i.e., OTPPB (and its Portfolio Entities), on one hand, and the Target Road Assets and HC One, on the other hand. Horizontal Overlap: 11. Market for road assets: It is submitted in the notice that the Commission in its past decisions in relation to the operations of road assets has considered each road asset to be a unique/separate market based on the origin and destination (O&D) method6. Further, the road concessions in India are granted through a tender process7 and are intended to select one concessionaire who will build, develop and operate the road. Accordingly, it is submitted that in terms of the concession agreement and based on the past decisions of the Commission, there are no horizontal overlaps between the Target Road Assets (i.e., G6 Assets, HG Assets, NUTPL, BETPL and Macquarie Assets, respectively) and the assets operated/owned by OTPPB (and its Portfolio Entities). 6 Shrem InvIT and Dilip Buildcon Limited and its associates (Combination Registration No. C-2022/04/925); IndInfravit Trust (acting through LTIDPL IndvIT Services Limited) and CPP Investment Board Private Holdings (4) Inc. (Combination Registration No. C-2022/09/966). 7 These tenders are issued by the National Highways Authority of India (NHAI) (or such other relevant regulatory authority, such as the Ministry of Road Transport & Highways, Government of India) (“Road Regulators”) periodically. Combination Registration No. C-2023/08/1046 Page 6 of 7 12. Market for Operations and Maintenance (O&M) of highways in the road infrastructure sector: Based on the submission of the Acquirers it is noted that the OTPPB and the Targets have business activities in the market of provision of O&M services of highways in the road infrastructure sector. It is submitted in the notice that the O&M services provided by each of the OTPPB Road Assets are captive in nature, i.e., each of the road assets provide O&M services to their own respective roads and do not (i) provide O&M services to any third party for their road(s), or (ii) engage a third party to provide O&M services for their own roads. Further, each of the Target Road Assets (i.e., G6 Assets, HG Assets, NUTPL, BETPL and Macquarie Assets) manage the O&M activities of their respective assets directly and/or engage third parties for various O&M related activity, and do not provide O&M services to third parties. Further, in a past decision8 the Commission has considered the market for O&M of highways in the road infrastructure sector in India as a relevant market. Similarly, in the present case, the relevant market can be considered as the market for „O&M of highways in the road infrastructure sector in India‟. Vertical/ Complementary Relationship: 13. The Acquirers have submitted that neither the Acquirers nor the investee entities of the Acquirer and the group to which the Acquirers belong i.e., OTPPB (and its Portfolio Entities) are involved in activities or manufacture of products which are used as inputs to build and operate road assets in India. In addition, OTPPB (and its Portfolio Entities) do not have any vertical or complementary overlaps with the business activities of (i) the Target Road Assets and (ii) HC One. 14. The Commission decided to assess the Proposed Combination in the segments identified by the Parties. However, exact delineation of the relevant market has been left open. Assessment of the Proposed Combination 8 Epic Concesiones Private Limited and Infrastructure Yield Plus II (Combination Registration No. C-2023/01/999) Combination Registration No. C-2023/08/1046 Page 7 of 7 15. Based on the submissions of the Acquirers, it is noted that the combined as well incremental market share of the Parties in the market for O&M of highways in the road infrastructure sector in India is in the range of [0-5] % only. Further, there are other players present in the market such as National Highways Authority of India, National Highways and Infrastructure Development Corporation Limited, IRB Infrastructure Developers Limited and IndInfravIT Trust. 16. Considering the material on record, including the details provided in the notice given under sub-section (2) of Section 6 of the Act, and the assessment of the Proposed Combination on the basis of factors stated in sub-section (4) of Section 20 of the Act, the Commission is of the opinion that Proposed Combination is not likely to have an appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act. 17. This order may stand revoked if, at any time, the information provided by the Acquirers is found to be incorrect. 18. The information provided by the Acquirers shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act. 19. The Secretary is directed to communicate to the Acquirers accordingly.