Deepak Fertilizers gets CCI nod to buy more stake in Mallya’s MCFL
21 Aug 2014 4:47 AM IST
Competition Commission has approved Deepak Fertilizers' proposed additional stake buy in Vijay Mallya group firm Mangalore Chemicals and Fertilizers.
The approval from the fair trade watchdog also paves the way for Deepak Fertilizers to make the open offer to acquire further 26 per cent stake in Mangalore Chemicals and Fertilisers Ltd (MCFL).
Giving its green signal, Competition Commission of India (CCI) has said the deal ‘is not likely to have appreciable adverse effect on competition in India’.
Under the deal, Deepak Fertilizers' subsidiary SCM Soilfert would acquire up to 26 per cent shareholding in MCFL through an open offer in addition to 0.8 per cent stake buy through open market. MCFL is part of Vijay Mallya's UB Group.
CCI approval pertains to both transactions. ‘It is observed that in the chemicals segment, the product portfolios of MCFL and DFPCL (Deepak Fertilizers and Petrochemicals Corporation Ltd) are different as the chemical products of MCFL are not substitutable with those of DFPCL and vice versa,’ CCI said in an order dated 30 July, but made public on Tuesday.
Noting that the overlap between the two firms was restricted to the fertiliser segment, CCI also observed that Deepak Fertilizer did not manufacture urea while MCFL's share in that market was ‘minimal’.
The approval from the fair trade watchdog also paves the way for Deepak Fertilizers to make the open offer to acquire further 26 per cent stake in Mangalore Chemicals and Fertilisers Ltd (MCFL).
Giving its green signal, Competition Commission of India (CCI) has said the deal ‘is not likely to have appreciable adverse effect on competition in India’.
Under the deal, Deepak Fertilizers' subsidiary SCM Soilfert would acquire up to 26 per cent shareholding in MCFL through an open offer in addition to 0.8 per cent stake buy through open market. MCFL is part of Vijay Mallya's UB Group.
CCI approval pertains to both transactions. ‘It is observed that in the chemicals segment, the product portfolios of MCFL and DFPCL (Deepak Fertilizers and Petrochemicals Corporation Ltd) are different as the chemical products of MCFL are not substitutable with those of DFPCL and vice versa,’ CCI said in an order dated 30 July, but made public on Tuesday.
Noting that the overlap between the two firms was restricted to the fertiliser segment, CCI also observed that Deepak Fertilizer did not manufacture urea while MCFL's share in that market was ‘minimal’.
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