CCI Approves the Acquisition of National Projects Construction Corporation Limited by WAPCOS Limited.

On March 28, 2019, CCI approved the acquisition of 98.89% of the equity share capital of National Projects Construction Corporation Limited (‘NPCC’) by WAPCOS Limited (‘WAPCOS’). WAPCOS and NPCC are both Central Public Sector Enterprises under the control of Ministry of Water Resources, River Development and Ganga Rejuvenation, Government of India (‘MoWR’). [1]

WAPCOS provides engineering consultancy services (‘ECS’) for developmental projects in India and abroad. NPCC’s services include project management consultancy services (‘PMCS’) for civil construction projects, real estate development, construction of roads etc.

CCI approved the transaction unconditionally since it found that the parties did not have significant horizontal or vertical overlaps. While WAPCOS and NPCC are active in the PMCS segment, they are insignificant players (by market share) as compared to other players like NBCC (India) Limited, Uttar Pradesh Rajkiya Nirman Nigam Limited, Bridge & Roof Co. (India) Limited etc. Further, while examining the vertical linkages between ECS and PMCS, CCI found no cause for concern since: (i) ECS offered by WAPCOS related primarily to water, power and irrigation infrastructure, while NPCC’s PMCS business was focused on general infrastructure like school, border fencing and road transportation; and (ii) WAPCOS faces strong competition in the ECS segment from players like Tata Consulting Engineers, Ramboll, etc.

[1] Combination Registration No. C-2019/03/655.

Published In:Inter Alia Special Edition- Competition Law - June 2019 [ English
Date: June 19, 2019