1. Mirae Asset Naver New Growth Fund I 2. Mirae Asset – GS Retail New Growth Fund I 3. Mirae Asset – Naver Asia Growth Investment Pte. Ltd. 4. Mirae Late Stage Opportunities Fund — Combination C-2023/10/1060

Notice under Section 6(2) of the Competition Act, 2002 given by Mirae Asset Naver New Growth Fund I, Mirae Asset – GS Retail New Growth Fund I, Mirae Asset – Naver Asia Growth Investment Pte. Ltd and Mirae Asset Late Stage Opportunities Fund

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 6th October 2023, the Competition Commission of India (Commission) received a notice under Section 6(2) of the Competition Act, 2002 (Act), given by Mirae Asset Naver New Growth Fund I (Mirae I), Mirae Asset – GS Retail New Growth Fund I (Mirae II), Mirae Asset – Naver Asia Growth Investment Pte. Ltd (Mirae III) and Mirae Asset Late Stage Opportunities Fund (Mirae IV) [collectively, Mirae Entities/Acquirers]. The notice relates to proposed acquisition of shares of Shadowfax Technologies Private Limited (Target/Shadowfax).

2. Mirae I, Mirae II and Mirae III are existing shareholders of Shadowfax and collectively hold around 5 percent shareholding along with certain rights. The notice relates to acquisition of compulsorily convertible preference shares of Shadowfax representing around 3 percent of the fully diluted share capital of the Target by Mirae IV (“Share Acquisition”); and contemporaneously with the completion of the Share Acquisition, acquisition of, inter alia, the right to appoint one director on the board of Shadowfax collectively by Mirae I, Mirae II, Mirae III and Mirae IV (“Right Acquisition”) [Share Acquisition and Right Acquisition collectively constitute “Proposed Transaction”]. The Proposed Transaction will be effectuated through: (i) the Share Subscription Agreement (SSA); (ii) the Shareholders’ Agreement (SHA), each executed on 26th September 2023. Pursuant to the Proposed Transaction, the collective shareholding of Mirae Entities in Shadowfax would be around 8 percent.

3. In terms of Regulations 14(3) of the Competition Commission of India (Procedure in Regard to the Transaction of Business related to Combinations) Regulations, 2011 (Combination Regulations), the Commission, vide letter dated 1st November 2023 (RFI), sought certain information and clarifications regarding, inter alia, existing shareholding/rights of Mirae I, Mirae II and Mirae III in Shadowfax, commercial linkages of Shadowfax with the investee entities of Mirae Entities, etc. The response was submitted by the Acquirers on 8th November 2023 (Response to RFI). Along with the Response to RFI, the Acquirers provided a clarification under Regulation 16 of the Combination Regulations to rectify a typographical error relating to the number of shares. The Commission considered the same and decided to take the clarification on record.

4. The Acquirers are controlled by entities that are ultimately directly or indirectly controlled by the Mirae Group which is a global financial group headquartered out of Seoul, South Korea. The Mirae Group offers globally diversified financial services and products including a diversified investment platform which provides its investors with investment solutions.

5. As submitted, the Target is a crowdsourced, tech-enabled logistics platform. The company has over 3 million delivery partners registered on its platform, serving a diverse set of 200+ enterprise customers. The Target is present in 2000+ cities in India, delivering over 1.5 million parcels every day to end consumers ordering a wide array of food, grocery, FMCG, electronics, consumer durables, pharma and apparel products.

6. As stated above, the Target is engaged in provision of third-party logistics services (3P logistics). 3P logistics is a broader term and in addition to transportation and delivery, it also includes various types of value-added services such as warehousing, terminal operations, customs brokerage, and supply chain management which can also include analytic services for tracking and tracing the delivery status of different products. Accordingly, for the purposes of competition assessment, 3P logistics services can be further segmented or sub-segmented considering the characteristics, intended use, pricing of services, business models in practice etc.

7. As regards the assessment of the Proposed Transaction, there are no horizontal overlaps even considering the activities of Target as 3P logistics services provider as a broader frame of reference. However, the same gives rise to two potential/existing vertical relationships. Two portfolio entities of the Mirae Group are engaged in activities which are at different stages or levels of the production chain in which the Target is involved. The first relates to the Mirae Group’s minority stake in Big Basket, which is an entity involved in online B2B/B2C sales and the second relates to investment by some entities within Mirae Group in Nextbillion, which is an entity involved in providing geospatial data and services.

8. Big Basket undertakes online B2B/B2C sales through its website and mobile application, and for the same, it requires 3P logistics services of the nature provided by Shadowfax. For the assessment of this vertical linkage, the plausible relevant markets can include the segment of 3P logistics services such as 3P logistics services for e-commerce etc., and online B2B/B2C sales or even narrower sub-segments of aforesaid segments. However, for the reasons given in ensuing paragraphs, the Proposed Transaction is not likely to result in any appreciable adverse effect on competition in any of the plausible markets that could be delineated, and accordingly, the question of the exact delineation of relevant market is left open.

9. The Commission observed that the existing linkage in form of provision of 3P logistics services by Shadowfax to Big Basket is insignificant both in terms of actual revenue derived by Shadowfax from Big Basket or in terms of proportion of total revenue of Shadowfax derived from Big Basket or in terms of reciprocal proportion of Big Basket’s total logistics spend. The same is indicative of lack of any likelihood of the Proposed Transaction conferring any ability/incentive to the parties involved for potentially engaging in any foreclosure strategies.

10. Nextbillion is the developer of a geospatial data platform designed to help enterprises such as Shadowfax to tackle location problems with the help of tailored location and navigation technology solutions. As submitted, the Target and Nextbillion do not have any existing relationships. Further, the overall presence of Nextbillion as reflected in its total turnover derived in India is insignificant to confer any ability/incentive to the parties involved for potentially engaging in any foreclosure strategies in any of the plausible markets that could have been delineated.

11. Considering the material on record including the details provided in the Notice and the assessment of the Proposed Transaction based on the factors stated in Section 20(4) of the Act, the Commission is of the opinion that the Proposed Transaction is not likely to have any appreciable adverse effect on competition in India. Therefore, the Commission approves the Proposed Transaction under Section 31(1) of the Act.

12. This order shall stand revoked if, at any time, the information provided by the Acquirers is found to be incorrect.

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

14. The Secretary is directed to communicate to the Acquirers accordingly.