FIL Capital Investments (Mauritius) II Limited — Combination C-2015/12/360
- Case No.C-2015/12/360
Ratio decidendi
The rule this decision rests on
A combination notified under section 6(2) of the Competition Act, 2002, may be approved under section 31(1) where, on the facts disclosed in the notice and an assessment of the factors in section 20(4), the Commission is of the opinion that it is not likely to have an appreciable adverse effect on competition in India. Where the acquirer represents that it holds no direct or indirect shareholding or control in enterprises present in, or vertically related to, the products of the target business, that representation forms part of the factual basis for that opinion. An approval under section 31(1) rests on the accuracy of the information furnished by the acquirer, and the approval stands revoked if that information is found to be incorrect.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
Notice under sub-section (2) of Section 6 of the Competition Act, 2002 given by FIL Capital Investments (Mauritius) II Limited.
Order under sub-section (1) of Section 31 of the Competition Act, 2002 (“Act”) CORAM: Mr. D. K. Sikri Chairperson
Mr. S. L. Bunker Member
Mr. Sudhir Mital Member
Mr. Augustine Peter Member
Mr. U. C. Nahta Member
Mr. M.S. Sahoo Member
Mr. G. P. Mittal Member
Legal representative: Cyril Amarchand Mangaldas
1. On 28.12.2015, the Competition Commission of India (“Commission”) received a notice given by FIL Capital Investments (Mauritius) II Limited (“Acquirer” or “Fidelity Mauritius”) under sub-section (2) of Section 6 of the Act pursuant to the execution of: (a) Investment Agreement (“IA”) entered into between the Acquirer, Cipla Limited (“Cipla”) and the Cipla Health Limited (“Cipla Health”) on 27.11.2015; and (b)
COMPETITION COMMISSION OF INDIA For Greater Good Agreement for Slump Sale of a Business Undertaking (“BTA”) entered into between Cipla and the Target on 27.12.2015.
2. As per the details provided in the notice, proposed combination relates to the acquisition of 26.11 per cent shareholding of the paid-up equity share capital of the Cipla Health by Fidelity Mauritius, on a fully diluted basis, by way of subscription to fresh equity shares and compulsory convertible preference shares pursuant to the IA. Further, Cipla proposes to transfer its over-the-counter (OTC) consumer business (“Target Business”) to Cipla Health by way of a slump sale, pursuant to the BTA. The Target Business proposed to be transferred by Cipla to Cipla Health comprises of "Nicotex", "Nicogum" and "Cofsils" (including generic manufacturing know-how; brands and all product variants), certain product ideas under development, and contractual arrangements (including purchase, manufacturing, marketing services and distribution arrangements).
3. The proposed combination falls under section 5(a) of the Act.
4. As per the information provided in the notice, Fidelity Mauritius is part of the proprietary venture capital arm of FIL Limited. The Acquirer's principal business activity is to hold investments and it does not have any subsidiaries, branches or offices in India. Further, Cipla is a public limited company incorporated under the provisions of the Companies Act, 1956 and is stated to be engaged in the business of pharmaceuticals. It has been further submitted that Cipla Health has been recently incorporated as a wholly-owned subsidiary of Cipla and does not have any subsidiary.
5. It has been submitted in the Notice that the Acquirer does not have any direct or indirect shareholding and/or control over enterprises, in India, that have any presence in the products comprising the Target Business or which are engaged in a vertical relationship with the products comprising the Target Business.
6. Considering the facts on record and the details provided in the notice given under sub-section (2) of section 6 of the Act and assessment of the proposed combination on the basis of 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 an appreciable adverse
COMPETITION COMMISSION OF INDIA For Greater Good effect on competition in India and therefore, the Commission hereby approves the same under sub-section (1) of section 31 of the Act.
7. This order shall stand revoked if, at any time, the information provided by the Acquirer is found to be incorrect.
8. The Secretary is directed to communicate to the Acquirer accordingly.
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