1. Multiples Private Equity Fund III 2. Multiples Private Equity Fund IV 3. Multiples Private Equity GIFT Fund IV — Combination C-2024/03/1127

Notice under Section 6(2) of the Competition Act, 2002 filed by Multiples Private Equity Fund III; Multiples Private Equity Fund IV and Multiples Private Equity GIFT Fund IV.

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 28th March 2024, the Competition Commission of India (Commission) received a notice under sub-section (2) of Section 6 of the Competition Act, 2002 (Act) filed by Multiples Private Equity Fund III (managed by Multiples Alternate Asset Management Private Limited) (Multiples Fund III); Multiples Private Equity Fund IV (managed by Multiples Alternate Asset Management Private Limited) (Multiples Fund IV); Multiples Private Equity GIFT Fund IV (managed by Multiples Asset Management IFSC LLP) (Multiples GIFT Fund IV) (collectively referred to as Multiples/Acquirers) for the proposed acquisition of stake in Svatantra Microfin Private Limited (SMPL) and rights in Svatantra Micro Housing Finance Corporation Limited (SMHFCL) (SMPL and Combination Registration No. C-2024/03/1127

SMHFCL are collectively referred to as ‘Target Entities’) [Hereinafter, the Acquirers and Target Entities are collectively referred to as ‘Parties’].

2. The notice has been filed pursuant to the following agreements: (a) Securities Subscription and Purchase Agreement between (i) SMPL, (ii) IGH Holdings Private Limited (IGH), (iii) Svatantra Holdings Private Limited (SHPL), (iv) Violicina Limited, and (v) Multiples, executed on 4th March 2024 (SSPA), and (b) Shareholders’ Agreement between (i) SMPL, (ii) IGH, (iii) SHPL, (iv)Violicina Limited, (v) Multiples, and (vi) Ananyashree Birla, executed on 4th March 2024.

3. The proposed combination envisages the acquisition of 12.97% of the total equity shareholding of SMPL by Multiples by way of subscription to fresh equity shares issued by SMPL and by purchasing compulsorily convertible non-cumulative preference shares of SMPL from IGH (SMPL Acquisition). Further, it envisages the acquisition of certain rights in SMHFCL on and from the date of closing of the Proposed Combination (SMHFCL Rights) [SMPL Acquisition and SMHFCL Rights are collectively referred to as the Proposed Combination].

4. Apart from the Proposed Combination i.e., acquisition of shares in SMPL and acquisition of certain rights in SMHFCL, no other transaction is included within the scope of the approval by the Commission. Any other transactions disclosed in the Notice are separate, unconnected, and independent of the Proposed Combination and are not being assessed and approved by the Commission, in any manner.

5. In terms of Regulation 14 of Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, the Commission, vide communications dated 12th April 2024, 23rd April 2024 and 09th May 2024 sought certain information(s)/ clarification(s), inter alia, relating to the activities of the Parties and the responses to the same were received on 18th April 2024, 26th April 2024 and 13th May 2024.

Combination Registration No. C-2024/03/1127

6. The Multiples Fund III and Multiples Fund IV are SEBI registered Category II AIFs and are being managed by Multiples Alternate Asset Management Private Limited (MAAMPL). Further, Multiples Private Equity Gift Fund IV is managed by Multiples Asset Management IFSC LLP (Multiples IFSC), which is a subsidiary of MAAMPL. The Acquirers do not directly or indirectly have any activities outside India, except for certain investments made in United States of America.

7. Apart from Multiples Fund III and Multiples Fund IV, MAAMPL acts as the investment manager to certain funds registered in India (India Funds) and as a sub-advisor (on a non-binding basis) to certain funds incorporated in Mauritius (Mauritius Funds) MAAMPL, Multiples IFSC, Multiples Gift Fund IV, India Funds and Mauritius Funds are collectively referred to as “Multiples Group”. Thus, the Acquirers belong to the Multiples Group. The Multiples Group through its investee companies are directly or indirectly engaged in sectors including financial services, banking, healthcare, pharmaceuticals, consumer, industrials etc. in India.

8. The Target is the ultimate holding company of the “SMPL group”. SMPL is a registered Non-Deposit Taking Systemically Important NBFC-MFI (Middle Layer). SHPL holds 15.9% equity shareholding in SMPL. SMPL along with Chaitanya India Fin Credit Private Limited (CIFCPL) (its wholly owned subsidiary) is engaged in the business of providing microfinance loans and personal loans to the customers in rural/semi urban areas. SMPL and CIFCPL also distribute credit-linked life insurance as an ancillary business activity to the loan itself.

9. SMHFCL is a registered Non-Deposit Taking housing finance company NBFC-HFC (Middle Layer). SHPL is the holding company of SMHFCL and holds 100% in SMHFCL. It is in the business of providing secured housing loans to the financially excluded rural and urban low-income families, loans to individuals against property and loans to corporates/ institutions for construction/ real estate projects. SMHFCL does not have any subsidiary/downstream affiliates in India.

Combination Registration No. C-2024/03/1127

10. It is submitted that the Acquirers through certain investee companies of funds advised and/or managed by Multiples Group exhibit horizontal overlaps with Target Entities in the market for (i) Loans and Lending services, (ii) Retail loans, (iii) Home loans, (iv) Loans to individuals against property.

11. Based on the above, the Parties have submitted that the relevant markets may be defined as: (i) the market for provision of loans and lending services in India (Broad Relevant Market) and (ii) the market for provision of retail loans in India (Narrow Market). The Narrow Market may further be segmented as: (a) the market for provision of Home Loans in India (Narrower Market 1); and (b) the market for provision for loans against properties in India (Narrower Market 2) [The Broad Market, the Narrow Market, Narrower Market 1, Narrower Market 2 are collectively referred to as the ‘Relevant Markets’].

12. The Commission decides to leave precise delineation of the relevant market open, as it was observed that because of the reasons stated below, the Proposed Combination is not likely to result in appreciable adverse effect on competition irrespective of the manner in which the relevant market is delineated.

13. Based on the submissions of the Parties, it is noted that the combined market shares of Parties in the Relevant Markets are in the range of [0-5] % only in terms of value. Further, there are other players present such as State Bank of India (SBI), HDFC Bank, ICICI Bank, Punjab National Bank (PNB), Bank of Baroda (BoB), Axis Bank and Kotak Mahindra Bank in the Broad Market; ICICI Bank, SBI, Axis Bank, BoB, HDFC Bank in the Narrower Segment 1; and HDFC Bank, IDFC First Bank, IndusInd Bank, ICICI Bank, and Axis Bank in the Narrower Segment 2, who will continue to pose competitive constraints to the Parties post the Proposed Combination.

Combination Registration No. C-2024/03/1127

14. 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 Section 31(1) of the Act.

15. This order may stand revoked if, at any time, the information provided by the Acquirer is found to be incorrect.

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

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