1. India Advantage Funds S5 I 2. Hcl Corporation Private Limited 3. Mirabilis Investment Trust 4. Mr. Aashil Apurva Shah 5. Mr. Ansh Ashit Shah

CCI2 Apr 2024C-2024/01/1105

Case brief

AI extract

What is this about?

The Competition Commission of India approved a proposed business combination involving HCL Corporation, an AIF, and promoters of Pritam International. The Commission found no horizontal overlaps and potential vertical relationship unlikely to cause appreciable adverse effect on competition.

What did the court decide?

The proposed combination was approved under Section 31(1) of the Competition Act, 2002.

1. India Advantage Funds S5 I 2. Hcl Corporation Private… — Company and Corporate | CCI (2024)

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COMPETITION COMMISSION OF INDIA

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Combination Registration No. C-2024/01/1105

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2^nd April 2024

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Notice under Section 6(2) of the Competition Act, 2002 jointly given by India Advantage Fund S5 I, HCL Corporation Private Limited, Mirabilis Investment Trust, Mr. Aashil Apurva Shah, Mr. Ansh Ashit Shah, Pritam International Private Limited, Mr. Rajat Kumar Bhalotia, and Mr. Rajesh Kumar Bhalotia

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CORAM:

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Ms. Ravneet Kaur Chairperson

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Mr. Anil Agrawal Member

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Ms. Sweta Kakkad Member

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Mr. Deepak Anurag Member

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Order under Section 31(1) of the Competition Act, 2002

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On 19^th January 2024, the Competition Commission of India (‘ Commission ’) received a notice (‘ Notice ’) under sub-section (2) of Section 6 of the Competition Act, 2002 (‘ Act ’) jointly given by India Advantage Fund S5 I (‘ IAF S5 I ’) through ICICI Venture Funds Management Company Limited (‘ IVEN ’), HCL Corporation Private Limited (‘ HCL Corp ’), Mirabilis Investment Trust (‘ Mirabilis ’) through its trustees, Mr. Aashil Apurva Shah and Mr. Ansh Ashit Shah [Hereinafter, IAF S5 I, HCL Corp, Mirabilis, Mr. Aashil Apurva Shah and Mr. Ansh Ashit Shah are collectively referred

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Page 1 of 5

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Combination Registration No. C-2024/01/1105

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to as the ‘ Acquirers ’]. The Notice was filed pursuant to the execution of the Shareholders Agreement and Share Subscription Agreement, each dated 22^nd December 2023, between Acquirers, Pritam International Private Limited (‘ Target ’) and promoters of the Target.

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The Proposed Combination envisages subscription of Compulsorily Convertible Preference Shares (‘ CCPS ’) of the Target by the Acquirers. Upon conversion of the CCPS, the total equity shareholding of the Acquirers shall be in the range of 21.3% to 24.1%. There are certain other inter-connected transactions to the Proposed Combination, inter alia, (a) the Target increasing its shareholding in certain group companies and partnership firms, and (b) an internal reorganisation of shareholding of the members of the promoter family in the Target.

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In terms of Regulation 14 of the Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011 (‘ Combination Regulations ’), vide letter dated 7^th February 2024, certain information and clarifications were sought from the Acquirers. The Acquirers submitted the response to the same vide communication dated 16^th February 2024 after seeking an extension of time. Since the response was not complete, a letter dated 23^rd February 2024 was issued and the response to the same was furnished vide communication dated 28^th February 2024. However, since the response was incomplete, another letter dated 7^th March 2024 was issued and the response was submitted on 12^th March 2024.

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In response to the letter dated 23^rd February 2024, Target, Mr. Rajat Kumar Bhalotia, and Mr. Rajesh Kumar Bhalotia also became notifying parties by furnishing relevant documents [Hereinafter, Acquirers, Target, Mr. Rajat Kumar Bhalotia and Mr. Rajesh Kumar Bhalotia are collectively referred to as the ‘ Notifying Parties ’].

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IAF S5 I is a determinate and contributory trust registered under the Indian Trusts Act, 1882. IAF S5 I is a category II alternative investment fund (‘ AIF ’) registered with the

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Page 2 of 5

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Combination Registration No. C-2024/01/1105

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Securities and Exchange Board of India (‘ SEBI ’) and carries on activities subject to the SEBI (Alternative Investment Funds) Regulations, 2012. IDBI Trusteeship Services Limited is the trustee for IAF S5 I. IVEN, a wholly-owned subsidiary of ICICI Bank Limited, acts as the investment manager of IAF S5 I.

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HCL Corp, a part of the HCL Group, is a registered Non-Banking Finance Company. It is stated to be incorporated with the primary objective of carrying on the business of holding investments in various entities within its group and investing funds in relevant securities.

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Mirabilis is registered under the Indian Trust Act, 1882. Mirabilis has been incorporated to invest in Indian companies as a financial investor. It does not have any activities worldwide. Beneficial owners of Mirabilis hold 100% stake in Addvantis Enterprises LLP (‘ Addvantis’ ). Addvantis runs a spa called “Veda Earth” and also uses/sells its own branded personal care products which are not manufactured in-house. These personal care products include shampoo, conditioner, bodywash, facewash, soap, etc.

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Mr. Aashil Apurva Shah and Mr. Ansh Ashit Shah are individual investors and do not belong to any group.

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Mr. Rajat Kumar Bhalotia and Mr. Rajesh Kumar Bhalotia are the promoters of the Target.

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Target, a company registered in India, belongs to the Wonder Products Group of Companies viz. the Pritam Group and is wholly-owned by the promoters and their family members. Target and its group companies are engaged, inter alia, in the development of formulation and contract manufacturing of personal care and grooming products, i.e. , skin care, hair care, baby care, oral care, deodorants, perfumes, etc.

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Page 3 of 5

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Combination Registration No. C-2024/01/1105

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Based on the activities of the Notifying Parties (including their group entities/affiliates), the Commission noted that there is no horizontal overlaps between the parties. Further, there is a potential vertical relationship in the contract manufacturing of beauty and personal care products in India ( upstream market ) by the Target and the sale of beauty and personal care products in India ( downstream market ) by Addvantis.

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The Commission decided to leave the delineation of the relevant market open, as it was observed that the Proposed Combination is not likely to cause an appreciable adverse effect on competition in any of the plausible relevant market(s) in India.

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Based on the submissions of the Notifying Parties, the Commission noted that the presence of Addvantis in the downstream market is miniscule and the market share of the Target in the upstream market is in the range of [5-10]%. Further, large players such as Hindustan Foods Limited, VVF (India) Limited, RM Chemicals and Lotus Beauty Care Private Limited operate in the upstream market. Based on the foregoing, it appears that the Proposed Combination is not likely to foreclose competition in any market in India.

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Considering the material on record, including the details provided in the Notice and the assessment of the Proposed Combination based on the 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. Therefore, the Commission approves the Proposed Combination under Section 31(1) of the Act.

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