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The Competition Commission of India approves the acquisition of the paper and pulp manufacturing business of Aditya Birla Real Estate Limited by ITC Limited on a slump sale basis. The combination involves horizontal overlaps in paper and paperboard segments and vertical linkages across related markets. The Commission concludes that the proposed combination does not create appreciable adverse effects on competition in India due to sufficient market alternatives, competitive constraints from imports, and buyer power.
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COMPETITION COMMISSION OF INDIA Combination Registration No. C-2025/08/1319
16th December 2025
Notice under Section 6(2) of the Competition Act, 2002 given by ITC 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
On 22nd August 2025, the Competition Commission of India (Commission) received a Notice under Section 6(2) of the Competition Act, 2002 (Act) given by ITC Limited (ITC/Acquirer).
The Notice was filed pursuant to the execution of Business Transfer Agreement (BTA) dated 31st March 2025 executed amongst the Acquirer and Aditya Birla Real Estate Limited (ABREL/Seller).
The proposed combination envisages the Seller proposing to divest, and the Acquirer proposing to acquire, the paper and pulp manufacturing business of ABREL (Target Business), as a going concern, on slump sale basis and in accordance with the terms and conditions set out under the BTA (Proposed Combination). The Acquirer and the Target Business are collectively referred to as the 'Parties'.
In terms of Regulation 14 of the Competition Commission of India (Combinations) Regulations, 2024 (Combinations Regulations), vide letters dated 4th September 2025 and 8th October 2025, certain information and clarifications were sought from the Parties. The responses to these letters were submitted by the Parties on 26th September 2025 and 5th November 2025 respectively, after seeking extensions of time (Response).
In terms of Regulation 14(8) of the Combinations Regulations, the Commission also sought information from third parties i.e., certain customers of the Parties vide letters dated 20th November 2025. The Commission received responses from certain customers of the Parties on or before 8th December 2025, after issuance of reminder letters to some of them (Customer Responses).
The Acquirer, i.e. ITC Limited, is a listed Indian company functioning as a diversified conglomerate having presence in fast-moving consumer goods (FMCG) (including packaged food products, cigarettes, personal care products, education and stationery products, safety matches and agarbattis), paper/paperboards and packaging, agri-business, and information technology, among others. It is 100% held by the public and as such neither belong to any group nor has any ultimate controlling person.
The Seller, i.e. ABREL, is a listed Indian company and part of the Aditya Birla group. The Aditya Birla group is a global conglomerate that operates across diverse sectors such as metals, cement, textiles, carbon black, telecom, real estate, pulp and paper manufacturing and financial services.
The Target Business^[1] comprises the pulp and paper manufacturing business of ABREL. In India, the Target Business is engaged in the business of manufacturing, distribution and sale of paper and paperboard in India including uncoated writing & printing paper (such as creamwove, Maplitho and copier), kraft paper, virgin multi-layer board (VMLB), tissue paper, cup stock, stiffener paper etc. The Target business operates through its manufacturing plant in Lalkuan, Uttarakhand, having supply operations pan India.
Manufacturing of paper and paperboard involves a process that transforms raw materials— primarily wood pulp, agri-residues, recycled fibres and various additives— into finished products used across industries. The production begins with pulping, where wood chips or recycled paper are broken down into fibers using mechanical or chemical methods. The pulp is then refined, cleaned, and bleached (if necessary) to achieve the desired quality. Next, the papermaking process takes place, where the pulp mixture is spread onto a moving screen, allowing water to drain and fibers to form a continuous sheet. The sheet is then pressed, dried, and smoothed to create the final paper or paperboard product. Different grades of paper/paperboard require additional processing steps as they are customised to meet industry-specific needs. At the broadest sector level, the Commission has considered relevant product market as the market for ‘manufacturing and sale of paper and paperboard’, which can be further sub-segmented into narrower categories based on various parameters.
Paper products are not homogenous in nature and their usage varies based on the weight (gram square meter i.e., GSM), thickness, brightness, smoothness, stiffness, cobb value (water absorbency), tear factor, burst factor, colour and other technical features of the paper. Furthermore, based on the type of raw material used, paper may be categorized into: (i) virgin fibre material; or (ii) recycled raw material. Additionally, depending on the end-use, the main categories of paper include: (i) writing and printing paper; (ii) newsprint paper; (iii) packaging paper and board; (iv) magazine/ poster paper; (v) tissue paper; and (vi) other speciality paper for industrial usage such as, cigarette paper, stiffener paper/ board, decorative paper, ledger paper and specialty board.
Within the broad paper and paperboard segment, the first narrow segment is writing and printing paper. Based on Commission’s decisional practice, the writing and printing paper can be further segmented into uncoated and coated paper, respectively. Uncoated writing and printing paper is a type of paper that lacks a glossy or matte coating, giving it a natural and porous texture. This allows ink to be absorbed more efficiently, making it ideal for applications such as books, office documents, notebooks, and commercial printing. Business activities of the Parties overlap only in the narrow segment of uncoated writing and printing paper.
The uncoated writing and printing paper can be further segmented into narrower sub-segments of (i) creamwove / low brightness Maplitho, (ii) high bright 88 + brightness Maplitho (‘Maplitho’) and (iii) copier paper. With regards to Maplitho, the Parties activity overlap only in the sub-segment of Maplitho – high bright 88+ brightness i.e., Maplitho. Such Maplitho paper is a premium grade uncoated paper known for its high surface smoothness and exceptional brightness. This type of paper is widely used for schoolbook publications, annual reports, journals, diaries, writing pads, and commercial printing due to its superior printability and smooth writing experience. Copier paper is a high-quality, thin paper designed for use in copiers, printers, and other office machines. It is typically sold in reams of 500 or 1,000 sheets and comes in various sizes, with A4 and A3 being the most common.
Furthermore, the broad market for paper and paperboard can also be segmented into a narrow segment of packaging paper/paperboard. Papers and paperboards, initially manufactured from processed pulp, undergo further refinement to create specialized variants designed for various packaging applications in the form of paper or paperboard. These materials are widely used in sectors such as food and beverages, pharmaceuticals, cosmetics, and consumer goods. The narrow segment includes products such as kraft paper and paperboards made from both virgin and recycled fibres. These are then utilized to produce packaging solutions like carton board etc.
The narrow segment of packaging paper/paperboard includes amongst others—virgin multi layered board (VMLB) and recycled duplex board (Recycled DB). Out of these, the Parties’ presence overlaps in only VMLB segment. The Parties have argued that their market presence should be looked at the level of packaging paper / board and not at the narrow level of VMLB as Recycled DB and VMLB are close substitutes. As per the submissions, from a consumer point of view, both VMLB and Recycled DB serve similar end-use applications and possess comparable physical characteristics. Despite differences in input materials, they offer similar performance in terms of strength, printability, and cost-effectiveness. Further, from a manufacturing standpoint, there is minimal friction when switching between the two types of paperboards ensuring that a common user class can engage in manufacturing of both VMLB and Recycled DB. It has also been submitted that while there is a slight price difference between VMLB and Recycled DB (VMLB being marginally higher due to its use of virgin pulp), this difference has minimal influence on customer choice and substitutability, considering that for FMCG companies that utilize these paperboards for packaging, the cost of the board itself typically accounts for only a small fraction of the product price.
The Commission observed the substitutability, both demand-side and supply-side, between VMLB and Recycled DB is rather limited. While VMLB is made from virgin wood pulp (new fibers, not recycled), the Recycled DB is made from recycled paper and waste fibers, thus, the basic raw material for manufacturing VMLB and Recycled DB are different. From demand side perspective also, the demand for both these products widely differ in terms of basic characteristics, pricing and intended end-use. VMLB being made from fresh wood pulp and having strength, durability, and printability remain consistent regardless of whether it will be converted into packaging for food, or cosmetic or pharmaceuticals. In terms of colour and appearance, it has a premium look being uniform white and smooth making it more suitable for luxury products like premium cosmetic products or perfumes etc. Recycled DB, on the other hand, usually has a grey or brown back, making it more suitable for packaging of FMCG products, soaps, detergent boxes, toy boxes, cartons, secondary packaging etc. Further, in terms of purity and hygiene, VMLB is hygienic, food-safe, odour-free and thus, can be used for direct food packaging, whereas, Recycled DB is generally perceived to be unsuitable for direct food contact. Thus, based on these differences, the Commission is of the view that VMLB and Recycled DB are not substitutable and may not be considered as part of the same market, despite there being some sort of end-use substitutability between the two.
Paper and paperboard market can also be segmented into a narrow segment for the manufacturing and/ or sale of cup stock, which refers to a type of paperboard specifically designed for manufacturing paper cups and containers. It is engineered to have high stiffness, durability, and liquid resistance, making it suitable for holding beverages and food items. Cup stock is often coated with polyethylene or other barrier materials to prevent leakage and enhance its strength. It is widely used in the food service industry, especially for holding hot and cold beverages like coffee cups, ice cream containers, and takeaway packaging.
Another market segment where the presence of Parties overlap is of stiffener paper, which falls within the “other paper / paperboard” products, as classified by IPMA. This category includes such paper products which do not fall under any of the other listed categories and includes various kinds of specialty papers for industrial usage such as, cigarette paper, stiffener paper/ board, decorative paper, ledger paper and speciality board. Stiffener paper is a specialized type of paper designed to provide rigidity and durability in various applications. It is commonly used in packaging, publishing, and industrial sectors to enhance product protection and structural integrity.
Lastly, the Parties’ presence also overlaps in the sub-segment of another speciality paper, namely the manufacturing of Oil and Grease Resistant Paper (OGR Paper). OGR Paper is a type of specialty paper which is designed to provide exceptional resistance against oils, greases, and other liquids, ensuring that food products (wrapped in OGR Paper) remain fresh and uncontaminated during packaging and storage. The main uses of OGR paper are for packaging of food products such as burgers, fries, pastries, and more.
Accordingly, based on the differentiating features of various paper and paperboard products and overlapping presence of the Parties, the Commission has considered the following narrow segments within the overall broad market for ‘manufacturing and sale of paper and paperboard’.
