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The Competition Commission of India approves the proposed combination involving the acquisition of shareholding in Kolte-Patil Developers Limited by BREP Asia III India Holding Co VII Pte. Ltd. under Section 31(1) of the Competition Act, 2002. The combination includes share subscription, share purchase, alternative additional share purchase, and a mandatory open offer under the Takeover Code. The Commission determines that the horizontal overlaps and potential vertical relationships in residential and commercial real estate markets are not likely to cause an appreciable adverse effect on competition in India. The approval is subject to the condition that the information provided by the acquirer remains correct.
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COMPETITION COMMISSION OF INDIA Combination Registration No. C-2025/04/1267
10th June 2025
Notice under Section 6(2) of the Competition Act, 2002 given by BREP Asia III India Holding Co VII 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
Hereinafter, SSA, SPA and SHA are collectively referred to as the Transaction Documents.
(a) Share Subscription: The Acquirer will subscribe to 1,26,75,685 shares of the Target;
(b) Share Purchase & Alternative Additional Share Purchase: Contemporaneously with the Share Subscription, the Acquirer will acquire 2,27,96,353 shares of the Target from certain existing shareholders (Share Purchase). In the event that the Target and the Sellers are unable to obtain all approvals and consents required for issue and allotment of the shares under the Share Subscription, on or prior to the certain date, the Acquirer shall acquire an additional 76,05,411 shares of the Target from certain existing shareholders (Alternative Additional Share Purchase); and
(c) Open Offer: The execution of the Transaction Documents will obligate the Acquirer to undertake a mandatory open offer under the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (Takeover Code) requiring the Acquirer to acquire up to 2,30,56,825 shares in the Target from its public shareholders.
If the Share Subscription proceeds, the Acquirer would hold upto 66% of the shareholding in the Target. If the Share Subscription does not proceed, the Acquirer would hold upto ~70.34% shareholding in the Target.
The Acquirer would also have inter alia right to appoint three directors on the board of directors of the Target and one director on each committee of the board of directors of the Target so long as the Acquirer holds at least 10% shareholding in the Target. Further, the Acquirer, amongst others, shall also have co-voting rights on certain matters (Specific Matters), with the Target’s promoters obligated to support its decisions in such matters, including attending and voting at shareholder meetings as directed.
The Acquirer, vide communications dated 15th April 2025 and 2nd May 2025, issued under Regulation 14 of the Competition Commission of India (Combinations) Regulations, 2024, was required to remove defects from the Notice and furnish certain information relevant for the purpose of assessment of the Proposed Combination. The Acquirer made its submissions vide responses dated 22nd April 2025 and 26th May 2025.
The Acquirer is owned by funds advised and/or managed by affiliates of Blackstone Inc. (collectively, the Blackstone). Blackstone, listed on the New York Stock Exchange, is a global alternative asset manager and has offices in several geographies, including, Europe and Asia.
The Target, established in 1991 and listed on the National Stock Exchange and the Bombay Stock Exchange, is a real estate company headquartered in Pune, Maharashtra. The Target and its affiliates (Target Entities) are engaged in the supply of residential real estate for sale in Pune, Mumbai Metropolitan Region (MMR) and Bengaluru; and commercial real estate in Pune and MMR.
Blackstone holds 49% stake in Embassy Office Parks Management Services Private Limited, the manager to Embassy Office Parks REIT (EOP REIT). However, it currently does not have any stake in the EOP REIT. Further, Blackstone holds 79% stake in Nexus Select Mall Management Private Limited, the manager of the Nexus Select Trust REIT (Nexus REIT). It has been submitted that the Commission may not consider the real estate assets of the Nexus REIT and EOP REIT for the purpose of mapping overlaps for assessment of the likely effect of the Proposed Combination.
In this regard the Commission observes this issue has already been dealt by the Commission in its order dated 24th February 2021, issued under sub-section (1) of Section 31 of the Act, in relation to the Combination Registration No. C-2020/12/794. For competition assessment of a combination involving the manager of a Real Estate Investment Trust (REIT) or person(s) to whom the manager of a REIT qualifies as an affiliate, supplies of REIT are also to be attributed to the manager and thus ought to be included in identification of overlap and competition assessment.
On 25th March 2025, Knowledge Realty Trust (Knowledge REIT), acting through its manager, Knowledge Realty Office Management Services Private Limited had given a notice, bearing Combination Registration No. C-2025/03/1264, under sub-section (2) of Section 6 of the Act (Other Notice). Entity(ies) belonging to the Blackstone is one of the acquirers in the Other Notice. In this regard, it has been submitted that the target entities in the Other Notice and the Target Entities in the Proposed Combination are operational in different cities and therefore, there is no overlap in their business activities.
Both the entities belonging to Blackstone, and the Target Entities are engaged in the supply of residential real estate for sale in the MMR, and Bengaluru. Accordingly, they exhibit horizontal overlaps in relation to the supply of residential real estate for sale in the MMR, and Bengaluru. Similarly, there is a horizontal overlap with regard to leasing of commercial real estate in Pune.
The combined market shares of the Acquirer group and the Target Entities for sale of residential real estate in Bengaluru and MMR in the range of [0-5] percent, and incremental market share for leasing of commercial real estate in Pune in the range of [0-5] percent, the horizontal overlaps are not likely to cause appreciable adverse effect on competition in India.
It has been submitted that in Pune, while the Target Entities sells their commercial real estate, the Acquirer group leases out their commercial real estate. In this regard, it is observed that size of business of the Target Entities for upstream market is not significant enough to cause foreclosure concerns.
It has been inter alia submitted that on one hand the Target Entities are engaged in the supply of commercial real estate for sale in the MMR, and on the other the entities belonging to Blackstone are engaged in the leasing of commercial real estate. However, no vertical relationship actually arises considering that the nature and type of the commercial real estate sold by the Target Entities do not serve as an input for the Acquirer group’s leasing operations. Furthermore, the Acquirer Group does not lease, nor is it involved in the leasing of, the type or size of commercial spaces developed and sold by the Target.
The Commission decide to leave precise delineation of relevant market as, irrespective of the relevant market delineation, the Proposed Combination is not likely to raise competition concern.
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 sub-section (4) of 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 sub-section (1) of Section 31 of the Act.
This order may be revoked if, at any time, the information provided by the Acquirer is found to be incorrect.
The information provided by the Acquirer shall be treated as confidential in terms of and subject to provisions of Section 57 of the Act.
The Secretary is directed to communicate this order to the Acquirer.
