CCI approves acquisition of Prayagraj Power Generation Company Limited by Renascent Power Ventures Private Limited

On December 27, 2018, CCI approved the acquisition of 75.01% of the total paid up equity share capital and 270 million optionally convertible redeemable preference shares of Prayagraj Power Generation Company Limited (‘PPGCL’) by Renascent Power Ventures Private Limited (‘Renascent’) (collectively referred to as ‘Parties’) pursuant to the execution of share purchase agreement dated November 13, 2018. [1]

PPGCL is engaged in the business of thermal power generation. Renascent, a wholly owned subsidiary of Resurgent Power Ventures Pte. Ltd. (‘Resurgent’), did not have any investments in the power sector in India. Further, Resurgent or any of its subsidiaries, prior to this transaction, did not have any investments in the power sector in India.  However, in its competitive assessment, CCI considered the overlaps between the shareholders of Resurgent (including Tata Power International Ltd.) and PPGCL.

CCI noted that the Parties were engaged in the similar business and involved vertically linkages in the market for power generation. In the competitive assessment, CCI noted that the combined market share of the Parties was within the range of 0-5% and the increment was less than a percent. Additionally, PPGCL had a long term obligation to supply a large part of its power generation to Uttar Pradesh power distribution utilities and had entered into interconnection agreement with Uttar Pradesh power transmission utilities.

Given the particulars of this transaction, CCI concluded that this transaction was unlikely to cause AAEC in India.

[1] Combination Registration No. C-2018/11/616