Mr. Sanjit Bakshi And Oriental Structural Engineers Private Limited — Combination C-2017/10/533
- Case No.C-2017/10/533
Ratio decidendi
The rule this decision rests on
The Commission's approval rests on the principle that a combination is approved under Section 31(1) where, having assessed it against the factors in Section 20(4), it is not likely to cause an appreciable adverse effect on competition in India. Where a shareholder exits and its shares are acquired by an existing shareholder who is already a promoter and director of the target, and the transaction does not change the competitive dynamics of the markets in which the target operates, the combination is not likely to have an appreciable adverse effect on competition. The approval is conditional on the accuracy of the information furnished by the parties, and it 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 Section 6 (2) of the Competition Act, 2002 filed by Mr. Sanjit Bakshi.
CORAM:
Mr.Devender Kumar Sikri Chairperson
Mr. S.L. Bunker Member
Mr. Sudhir Mital Member
Mr. Augustine Peter Member Mr. U.C. Nahta Member
Legal Representative: Luthra & Luthra
Order under Section 31(1) of the Competition Act, 2002
1. On 30th October, 2017, the Competition Commission of India (hereinafter referred to as the “Commission”) received a notice filed by Mr. Sanjit Bakshi (“SB”) pursuant to a Share Purchase Agreement (“SPA”) dated 30th June, 2017 entered, inter-alia, amongst GE Equity International Mauritius (“GE”) SB and Oriental Structural Engineers Private Limited (“OSE”). (Hereinafter, OSE and SB are collectively referred to as “Parties).
COMPETITION COMMISSION OF INDIA For Greater Good
2. The proposed combination, filed under sub-section (2) of Section 6 read with sub-section (a) of Section 5 of the Competition Act, 2002 (“Act”), relates to acquisition of 5.615 per cent stake by SB in OSE from GE.
3. SB, an individual, is a director and promoter in OSE. It is stated that SB also has shareholding and directorship in several companies owned by the promoters. Currently, SB holds a 3.78 percent stake in OSE in his individual capacity and 9.27 percent through his HUF and post the proposed combination, he would hold around 9 per cent stake in his individual capacity, and 9.27 percent stake through his HUF.
4. OSE, a private company incorporated in India, is inter-alia, engaged in the business of construction of roads, mining of coal and mining of other minerals in India.
5. The Commission observed that as a result of proposed combination, one of the shareholder is exiting (i.e. GE) from OSE and its shares are being acquired by an existing shareholder i.e. SB, already a Promoter and Director in OSE. In view of foregoing, the proposed combination does not appear to change competition dynamics in the markets in which OSE is engaged.
6. Considering the facts on record, 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 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 any appreciable adverse 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 Parties is found to be incorrect.
8. The information provided by the parties shall be treated as confidential in terms of and subject to the provisions of Section 57 of the Act.
COMPETITION COMMISSION OF INDIA For Greater Good 9. The Secretary is directed to communicate to the parties accordingly.
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