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COMPETITION COMMISSION OF INDIA Combination Registration No. C-2024/05/1144
23rd July 2024
Notice under Section 6(2) of the Competition Act, 2002 given by Sanlam Emerging Markets (Mauritius) 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 $15^{\text{th}}$ May 2024, the Competition Commission of India (Commission) received a notice (Notice) under sub-section (2) of Section 6 of the Competition Act, 2002 (Act), given by Sanlam Emerging Markets (Mauritius) Limited (SEMM). The Notice was given pursuant to execution of the Share Purchase Agreement between Shriram GI Holdings Private Limited (SGIH), Shriram General Insurance Company Limited (Shriram General Insurance), TPG India Investments II Inc. (TPG), and SEMM on $10^{\text{th}}$ April 2024; and the Share Purchase Agreement between SGIH, Shriram General Insurance, Shriram Ownership Trust (SOT), and SEMM on $10^{\text{th}}$ April 2024.
SEMM vide communications dated $22^{\text{nd}}$ May 2024 and $25^{\text{th}}$ June 2024 issued under Regulation 14 of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011 (Combination Regulations) was required to remove defects from the Notice and furnish certain information relevant for the purpose of assessment of the proposed combination. SEMM furnished its responses vide submissions dated $10^{\text{th}}$ June 2024 and $1^{\text{st}}$ July 2024.
The proposed combination envisages the acquisition by SEMM of $16.12%$1 of the share capital of SGIH from its existing shareholders viz., from TPG2 SOT3 (Proposed Combination).
SEMM, incorporated in Mauritius, is a wholly owned subsidiary of Sanlam Limited, South Africa. It has been submitted that SEMM holds $40.70%$ stake in Shriram Capital Private Limited (Shriram Capital), the holding company of SLIH; $23%$ direct stake in Shriram Life Insurance, and $22.92%$ direct stake in Shriram General Insurance Company Limited (Shriram General Insurance). Further, another wholly owned subsidiary of Sanlam Limited viz. Sanlam Life Insurance Limited holds $0.41%$ stake in Shriram Finance Limited (Shriram Finance). SEMM has no business or investment in India other than the above-mentioned stakes.
SGIH does not have any business of its own. However, it is the promoter and holding company of Shriram General Insurance and holds $66.64%$ stake therein. Shriram General Insurance is engaged in the business of general insurance.
Shriram Capital has $17.87%$ stake in Shriram Finance, which holds a corporate insurance broking license to distribute life and general insurance products. Further, Shriram Capital has $63.88%$ stake in Shriram Investment Holdings Private Limited (SIHL). Way2Wealth Insurance Brokers Private Limited (W2WIB) and Shriram Fortune Solutions Limited (SFSL) are the subsidiaries of SIHL. W2WIB and SFSL are engaged in the activity of insurance broker and corporate agent. Therefore, the insurance provision activities of Shriram General Insurance on one hand and Shriram Finance, W2WIB, and SFSL on the other exhibit a vertical interface.
The market share of Shriram General Insurance for the provision of general insurance products; and W2WIB, Shriram Finance, and SFSL for the distribution of insurance products are less than $1%$. Therefore, the vertical interface is not likely to cause foreclosure concerns.
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 appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act.
This order may be revoked if, at any time, the information provided by SEMM is found to be incorrect.
The information provided by SEMM 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 SEMM.
1 17,31,98,417 shares 2 10,13,80,344 shares amounting to $9.44%$ 3 7,18,18,073 shares amounting to $6.68%$
