Aquilo House Pte. Ltd. Combination Approval

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COMPETITION COMMISSION OF INDIA Combination Registration No.C-2024/09/1184

22nd October 2024

Notice under Section 6(2) of the Competition Act, 2002 filed by Aquilo House Pte. Ltd.

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 $05^\text{th}$ September 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 Aquilo House Pte. Ltd. (Acquirer) in relation to acquisition of equity shares and control in Aavas Financiers Limited (Target) [Hereinafter, the Acquirer and the Target are collectively referred to as the Parties].

2. The notice has been filed pursuant to the Share Sale Agreement dated $10^\text{th}$ August 2024, entered into amongst the Acquirer, the Target and Lake District Holdings Limited (LDHL) (SPA 1); Share Sale Agreement dated $10^\text{th}$ August 2024 entered into amongst the Acquirer, the Target and Partners Group ESCL Limited (PGEL), (SPA 2); Share Sale Agreement dated $10^\text{th}$ August 2024 entered into amongst the Acquirer, the Target and Partners Group Private Equity (Master Fund), LLC (PG Master Fund) (SPA 3)

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[LDHL, PGEL and PG Master Fund are collectively referred to as the Sellers and SPA 1, SPA 2, and SPA 3 are collectively referred to as the SPAs].

3. The proposed combination involves an acquisition of up to 41,688,823 Equity Shares in the Target amounting to up to 52.68% of the Share Capital of the Target and control of the Target by way of the following:

• (i) Underlying Transaction: The Acquirer shall acquire equity shares in the Target, amounting to 26.47% of the share capital from the Sellers pursuant to the consummation of the SPAs. On consummation of the Underlying Transaction, the Sellers will completely exit the Target;
• (ii) MTO Transaction: In accordance with the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 and subsequent amendments thereto (SEBI SAST Regulations), the Acquirer has made a public announcement on $10^\text{th}$ August 2024 in relation to an open offer for acquisition of up to 26.21% of the equity share capital to the public shareholders of Target;
• (iii) Control: The Acquirer will acquire sole control of the Target upon consummation of the SPAs.

[Collectively, referred to as the Proposed Combination].

4. In terms of Regulation 14 of Competition Commission of India (Combinations) Regulations, 2024, communications dated $13^\text{th}$ September 2024 and $27^\text{th}$ September 2024 were issued to the Acquirer seeking certain information(s)/ clarification(s), inter alia, relating to the activities of the Parties and the responses to the same were received on $21^\text{st}$ September 2024 and $14^\text{th}$ October 2024, respectively.

5. The Acquirer is a newly incorporated entity. The Acquirer does not currently undertake any business. Further, the Acquirer does not have any physical presence or any portfolio companies or investments in India.

6. It is stated in the notice that 100% of the share capital of the Acquirer is held by Aquilo Universe Pte. Ltd. which in turn is 100% held by Aquilo Midco Pte. Ltd. (Aquilo Midco). The shareholders of Aquilo Midco are: (i) Aquilo TopCo Pte. Ltd. (Aquilo

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TopCo) (67%) and (ii) Aquilo Co-Investment L.P. (Co-invest Fund) (33%). Further, 100% of the share capital of Aquilo TopCo is held by: (i) CVC Capital Partners Asia VI (A) L.P.; (ii) CVC Capital Partners Investment Asia VI L.P., (collectively, Jersey Asia Fund VI Entities); and (iii) CVC Capital Partners Asia VI (B) SCSp (Lux Asia Fund VI Entity) [Jersey Asia Fund VI Entities; the Lux Asia Fund VI Entity, and the Co-invest Fund are collectively referred to as Relevant CVC Funds]. Thus, the Acquirer is indirectly and wholly owned by the Relevant CVC Funds, which are controlled by their respective general partners and ultimately controlled by CVC Capital Partners plc (CVC PLC), a public limited company whose shares are listed and admitted to trading on the Euronext Amsterdam Stock Exchange.

7. The Parties have submitted that the Acquirer belongs to the CVC Network or CVC Group comprising CVC PLC and its subsidiaries from time to time. CVC PLC ultimately controls the global alternative investment managers which are inter alia focused on private equity, credit and infrastructure. The CVC Group’s activities include providing investment advice to and/ or managing investments for, and on behalf of, the CVC Funds, including the Relevant CVC Funds. The CVC Funds hold interests in a number of companies in various industries primarily in Europe, the USA and the Asia-Pacific region. In India, CVC Network is present through certain entities that meet the Materiality Thresholds$^1$, namely, Sajjan India Limited, HealthCare Global Enterprises Limited and Irelia Sports India Private Limited.

8. The Target is a listed public limited company incorporated in India. It is registered with the National Housing Bank as a non-deposit taking Housing Finance Company. It primarily offers home loans, loans against property, and micro, small and medium enterprises business loans. It is also registered as a corporate agent with the Insurance Regulatory and Development Authority of India; however, its insurance distribution activities are limited to customers that avail loans and lending services from the Target.

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$^1$ Entities where CVC PLC has: (i) direct or indirect shareholding of 10% (ten percent) or more; or (ii) a right or ability to exercise any right that is not available to an ordinary shareholder; or (iii) a right or ability to nominate a director or observer (collectively, the Materiality Thresholds).

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9. Based on the submissions of the parties, it is noted that there are no horizontal overlaps, or vertical or complementary relationships between the activities of: (i) the Acquirer, or any controlled portfolio companies of CVC Funds that may have a presence in India based on Materiality Thresholds, or entities belonging to the CVC Group; and (ii) the Target.

10. Considering the material on record, including the details provided in the notice and the assessment of the Proposed Combination based on the factors stated in subsection (4) Section 20 of the Act, the Commission is of the opinion that the Proposed 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.

11. This order may stand revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

12. The information provided by the Acquirer shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act.

13. The Secretary is directed to communicate to the Acquirer accordingly.