Investcorp India Asset Managers Private Limited. — Combination C-2022/02/909

COMPETITION COMMISSION OF INDIA 13th April 2022 Notice under Section 6(2) of the Competition Act, 2002 given by Investcorp India Asset Managers Private Limited CORAM: Mr. Ashok Kumar Gupta Chairperson Ms. Sangeeta Verma Member Mr. Bhagwant Singh Bishnoi Member Order under Section 31(1) of the Competition Act, 2002 1. On 17th February 2022, the Competition Commission of India (Commission) received a notice (Notice) under Section 6(2) of the Competition Act, 2002 (Act), given by Investcorp India Asset Managers Private Limited (Investcorp India). Investcorp India also made voluntary submissions dated 28th March 2022.

2. This Notice has been given in relation to the acquisition of the real estate fund management and private equity fund management businesses of IDFC Alternatives Limited (IDFC Alternatives) by Investcorp India on a slump sale basis for a lump sum consideration (Fund Management Acquisition). As part of the Fund Management Acquisition, Investcorp India acquired control over the business, comprising management of the following four funds:

- Investcorp Infrastructure Fund I (formerly known as IDFC Infrastructure Fund 3): A fund registered as a venture capital fund under the Securities and Exchange Board of India (Venture Capital Funds) Regulations, 1996;

- Investcorp Private Equity Fund II (formerly known as IDFC Private Equity Fund IV): A fund registered as an alternative investment fund under the Securities and Exchange Board of India (Alternative Investment Fund) Regulations, 2012 (AIF Regulations);

- Investcorp Real Estate Yield Fund (formerly known as IDFC Real Estate Yield Fund): A fund registered as an alternative investment fund under the AIF Regulations; and - Investcorp SCORE Fund (formerly known as IDFC SCORE Fund): A fund registered as an alternative investment fund under the AIF Regulations.

3. It has been submitted that Investcorp Asia Services Pte. Ltd. (Investcorp Asia) also entered into Unit Purchase Agreements with IDFC Limited and IDFC Financial Holding Company Limited (IDFC Financial Holding) on 26th July 2018 (UPAs) in relation to the abovementioned four funds. Thereafter, Investcorp India entered into an assignment and novation agreement to the unit purchase agreement with Investcorp Asia, IDFC Limited and IDFC Financial Holding in respect of IDFC Infrastructure Fund 3 (currently known as Investcorp Infrastructure Fund I) on 30th January 2019 (Assignment and Novation to UPA). These UPAs and the Assignment and Novation to UPA were entered in relation to carry units. Carry units held by Investcorp group entities are not entitled to any distribution if the fund does not cross a specific rate of profits/returns, as set out in the distribution waterfall in the fund documents. 4. Earlier, the Commission, vide its order dated 17th December 2021 issued under Section 43A of the Act, concluded that the Fund Management Acquisition was a combination in terms of Section 5 of the Act, and exemption granted through notification no. S.O. 988(E) dated 27th March 2017 issued by the Ministry of Corporate Affairs, Government of India in exercise of power conferred under Section 54 of the Act (De Minimis Exemption) was not available in relation to the same. Accordingly, Investcorp India, being the acquirer, failed to give notice to the Commission in terms of Section 6(2) of the Act. The Commission, in its meeting held on 29th December 2021, under Regulation 8(2) of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, directed Investcorp India to file a notice with the Commission in Form I in relation to the Fund Management Acquisition within specified time (Direction of the Commission to File Notice). This Notice has been given pursuant to the Direction of the Commission to File Notice.

5. Investcorp India is an indirect wholly owned subsidiary of Bahrain-based Investcorp Holdings B.S.C. Investcorp India is part of the Investcorp group. The Investcorp group is claimed to be globally active in the management of alternative investments across private equity, real estate, absolute return investments, infrastructure, credit management and strategic capital businesses. Investcorp India also offers investment advisory services outside India. The main business activity of Investcorp India is to provide asset/investment management services in India and to manage, operate and supervise investment vehicles, including alternative investment funds, venture capital funds, etc.

6. In the absence of any overlap, the Combination is not likely to raise any competition concern.

7. Considering the material on record including details provided in the Notice given under Section 6(2) of the Act and assessment of the Combination based on the factors stated in Section 20(4) of the Act, the Commission is of the opinion that the 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 same under Section 31(1) of the Act.

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

9. The information provided by the notifying party is confidential at this stage in terms of and subject to the provisions of Section 57 of the Act.

10. The Secretary is directed to communicate to the notifying party accordingly.