General Atlantic Singapore ACK Pte. Ltd, Singapore — Combination C-2023/04/1017

COMPETITION COMMISSION OF INDIA 6th June 2023 Notice under Section 6(2) of the Competition Act, 2002 given by General Atlantic Singapore ACK Pte. Ltd. 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 10th April 2023, the Competition Commission of India (Commission) received a notice (Notice), under Section 6(2) of the Competition Act, 2002 (Act), given by General Atlantic Singapore ACK Pte. Ltd. (GASACK/Acquirer). The Notice was given pursuant to execution of the Series E Subscription Agreement, inter alia, between Acko Technology and Services Private Limited (Acko Tech/Target) and GASACK on 23rd March 2023 (SSA) and the Amended and Restated Shareholders’ Agreement, inter alia, between Acko Tech and GASACK on 23rd March 2023 (SHA). 2. The Commission, vide its communications dated 12th April 2023 and 19th April 2023, issued under Regulation 14(3) of the Competition Commission of India (Procedure in regard to transaction of business relating to combinations) Regulations, 2011 (Combination Regulations), required the notifying party to remove defects in the Notice and furnish certain information relevant for the purpose of assessment of the Proposed Combination. The notifying party furnished its responses vide submissions dated 18th April 2023 and 28th April 2023.

3. The Proposed Combination envisages acquisition of 4.04% shareholding of Acko Tech as under:

(i) GASACK will subscribe to 48,62,429 compulsorily convertible cumulative preference shares (CCPS) of Acko Tech (First Tranche Investment); and (ii) GASACK has the right but not an obligation to invest a further sum by way of subscription to 24,31,215 CCPS, post-closing of the First Tranche Investment, within 60 days of the first long stop date.

4. GASACK already holds 15.54% of the equity share capital of Acko Tech and has certain affirmative vote rights, information rights and right of representation on the board of directors of Acko Tech. The Proposed Combination also envisages additional rights to GASACK such as the right to appoint an additional director on the board of Acko Tech, have its representation in certain committees, and to appoint an observer on the board of directors of any of Acko Tech’s regulated subsidiaries, including Acko General Insurance Limited (Acko GI) and Acko Life Insurance Limited (Acko Life).

5. GASACK is said to be an investment holding company incorporated under the laws of Singapore. It is a wholly owned step-down subsidiary of General Atlantic Singapore Fund Pte. Ltd. It is managed and advised by entities controlled by General Atlantic, a global growth equity investment firm that invests through its family of funds.

6. Acko Tech is said to be predominantly engaged in the business of providing technology development and outsourcing solutions in the insurance sector. Acko Tech also operates its wholly owned subsidiaries, Acko GI, which is a licensed general insurance provider, and Acko Life, which is in the process of seeking license from the Insurance Regulatory and Development Authority of India to conduct life insurance business in India.

7. Acko Tech holds 2.95% stake in Vivish Technologies Private Limited (Vivish) and a right to appoint an observer to the board of Vivish. Vivish is engaged in the business of operating a society and gated community management software, viz., MyGate. The MyGate application also contains a separate platform for buying, selling and renting immovable property, viz., MyGate Homes. Further, fund controlled by General Atlantic holds 32.4% stake in NoBroker Technologies Solutions Private Limited (NoBroker). NoBroker is engaged in a business similar to that of Vivish. NoBroker owns and operates a platform for buying, selling and renting immovable property, viz., NoBroker.in. NoBroker also has a separate gated community management software platform, viz., NoBrokerHood. Therefore, the activities of Vivish and NoBroker exhibit horizontal overlaps.

8. In view of the limited presence of MyGate Home in the segment of operation of platform for buying, selling and renting immovable property, the Proposed Combination is not likely to raise any competition concerns. However, the precise delineation of the relevant market is left open.

9. Vivish and NoBroker are significant players in society/gated community management solutions. The acquirer group already has considerable stake in NoBroker. Pursuant to the Proposed Combination, General Atlantic is gaining further influence over Acko Tech. Acko Tech, i.e., the Target, has a right to appoint an observer on the board of Vivish. Common interest and, direct or indirect, influence, if any, of the acquirer group in the two prominent players for society/gated community management solutions, may raise the risk of softening of competition between the two prominent players.

10. In order to address any concerns that may arise due to the Proposed Combination, GAP Bermuda, L.P. (GAP) and GASACK, vide their submission dated 1st June 2023, in terms of Regulation 19(2) of the Combinations Regulations, offered voluntary modifications, given in the Annexure. In terms of the voluntary modifications, GAP and GASACK have undertaken that GAP, GASACK and any other entity belonging to the group to which GASACK belongs (General Atlantic) shall not, directly or indirectly, (a) participate in, associate with or exert influence on any matter or affair related to Vivish or investment of Acko Tech therein; (b) access, knowingly receive or become privy, to any non-public information relating to Vivish which is accessed or possessed by Acko Tech; and (c) influence or engage with any person appointed by Acko Tech, as an observer on the board of Vivish or in any capacity vis-à-vis Vivish. In this regard, it is observed that the remedies offered by GAP and GASACK are expected to address the concern that may arise from the common influence of the acquirer group, if any, over two prominent players, viz., MyGate Home and NoBrokerHood. Accordingly, no further examination of the overlap between MyGate Home and NoBrokerHood is warranted in light of the voluntary modifications offered.

11. With regard to vertical interface, it has been submitted that some of the subsidiaries of the portfolio companies of General Atlantic are engaged in the insurance broking business. Acko GI is engaged in the business of providing general insurance. Therefore, the activities of Acko GI and subsidiaries of portfolio companies of General Atlantic exhibit vertical interface. In this regard, the Commission observes that the presence of Acko GI and the subsidiaries of portfolio companies of General Atlantic in the domain of general insurance is not significant enough to raise any competition concerns.

12. Considering the material on record, including the details provided in the Notice and the assessment of the Proposed Combination based on 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 in any of the relevant market(s), and therefore, the Commission hereby approves the Proposed Combination under Section 31(1) of the Act subject to carrying out of modifications furnished under Regulation 19(2) of the Combination Regulations, placed in the Annexure.

13. This order may be revoked if, at any time, the information provided by the notifying parties is found to be incorrect.

14. It is made clear that nothing contained in this order shall be deemed to be confidential, as the same has been used for the purposes of the Act in terms of the provisions contained in Section 57 of the Act.

15. The Secretary is directed to communicate to the notifying parties accordingly.

ANNEXURE 1. GAP, GASACK and any other entity belonging to the group to which GASACK belongs (General Atlantic), shall not, directly or indirectly:

a. Participate in, associate with or exert influence on any matter or affair related to Vivish or investment of Acko Tech therein;

b. Access, knowingly receive or become privy to, any non-public information relating to Vivish which is accessed or possessed by Acko Tech. Further, GAP and GASACK will issue directions, within 7 working days from the date of the order of the Competition Commission of India, to Acko Tech to not share any non-public information relating to Vivish which is accessed or possessed by Acko Tech;

c. Influence or engage with any person appointed by Acko Tech, as an observer on the board of Vivish or in any capacity vis-à-vis Vivish.

2. The above remedial modifications are offered to address any potential harm to competition because of common interest of General Atlantic in two competing entities viz. Vivish, indirectly through Acko Tech, and directly in NoBroker. Therefore, the interpretation of the above modifications shall not be restricted to its literal meaning. The remedial modifications shall be interpreted purposively to give effect to the objectives of offering them viz. avoidance of direct or indirect: (i) influence of General Atlantic over one of the two competing entities, viz. Vivish and NoBroker and (ii) access to non-public information relating to Vivish which is accessed and possessed by Acko Tech.

3. The above remedies shall be applicable on General Atlantic as long as it has a stake in NoBroker.