Pelipper HoldCo. SARL Combination Approval

COMPETITION COMMISSION OF INDIA (Combination Registration No. C-2023/06/1037)

16th August 2023

Notice under Section 6(2) of the Competition Act, 2002 given by Pelipper HoldCo SARL

CORAM:

Ms. Ravneet Kaur Chairperson

Ms. Sangeeta Verma Member

Mr. Bhagwant Singh Bishnoi Member

Order under Section 31(1) of the Competition Act, 2002

1. On 26th June 2023, the Competition Commission of India (‘Commission’) received a Notice under Section 6(2) of the Competition Act, 2002 (‘Act’) given by Pelipper HoldCo SARL (‘Acquirer’/‘Pelipper’). The Notice was filed pursuant to the execution of (i) Share Purchase Agreement and (ii) Shareholders’ Agreement, each dated 14th May 2023, inter alios, between Pelipper and IBS Software Pte. Ltd. (‘Target’/‘IBS Software’).

2. The Proposed Combination envisages the acquisition of approximately 30% of the issued share capital on a fully diluted basis of the Target by the Acquirer from Techware Singapore Holdings Pte. Ltd. (‘Seller’), a portfolio company of Blackstone Inc.

3. In terms of Regulation 14 of the Competition Commission of India (Procedure in regard to the transaction of Business relating to Combinations) Regulations, 2011 (‘Combination Regulations’), vide letter dated 10th July 2023, certain information and clarifications were sought from the Acquirer. The response was submitted by the Acquirer on 26th July 2023 after seeking an extension of time. The Acquirer also provided certain additional clarifications by way of voluntary submission dated 7th August 2023.

4. The Acquirer is a special purpose vehicle incorporated under the laws of Luxembourg for the purpose of the Proposed Combination and is indirectly wholly-owned by investment funds advised by Apax Partners LLP (‘AP’). AP is a limited liability partnership incorporated under the laws of United Kingdom and the parent of a number of entities which provide investment advisory services to private equity funds investing in a range of industry sectors (‘AP Funds’).

5. The Target is the parent company of IBS group of companies (‘Target Group’). The Target Group is primarily active as a provider of software solutions to the travel industry globally, managing operations for customers in the aviation, tour & cruise, hospitality and energy resources industries. The Target Group's solutions for the aviation industry cover fleet and crew operations, aircraft maintenance, passenger services, loyalty programs, staff travel & air-cargo management. The Target is present in India through its subsidiary, IBS Software Private Limited (‘IBS India’).

6. The Commission noted that the activities of the AP Funds (including its portfolio entities) and the Target Group exhibit horizontal overlaps at a broad level in the market for IT and IT enabled services (‘ITeS’) (‘Broad Market’) and at a narrower level in the segments for (i) consulting services; (ii) application implementation and managed services and (iii) enterprise application software services in India (‘Narrow Segments’) (Hereinafter, together referred to as ‘Relevant Markets’). It is submitted that the Acquirer (directly or indirectly, through the portfolio companies of AP Funds) does not provide IT and ITeS services in the travel/hospitality sector to any customer in India.

7. The Commission decided to leave the delineation of the relevant market open, as it was observed that the Proposed Combination is not likely to cause an appreciable adverse effect on competition in any of the relevant markets in India.

8. Based on the submissions of the Acquirer, the Commission noted that the Target Group derives minuscule revenue from its customers in India. Further, it is observed that, in each of the Relevant Markets identified above, the combined market share of Target Group and portfolio companies of AP Funds is in the range of [0-5%] in terms of value, and the incremental market share is insignificant. The sector is characterised by the presence of several global as well as domestic players such as Microsoft, Tata Consultancy Services, SAP, Amazon, Oracle, Deloitte, Ernst & Young, Cognizant, Infosys etc.

9. 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 Section 20(4) of the Act, the Commission is of the opinion that the Proposed Combination is not likely to have any appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act.

10. The order may be revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

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

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