21 July 2015
On May 13, 2015, CCI approved the acquisition of shares by Sundaram Finance Limited (‘SFL’) in Royal Sundaram Alliance Insurance Company Limited (‘Royal Sundaram’). The notice was filed pursuant to a Share Purchase Agreement executed between SFL, Royal & Sun Alliance In- surance, Plc (‘RSA’), and Royal Sundaram on February 18, 2015. CCI observed that post-combination SFL would acquire sole control over Royal Sundaram.
SFL is classified as an asset financing company while Royal Sundaram offers general insurance solutions to individuals, families, and businesses and inter-alia offers motor, health, per- sonal accident, home, and travel insurance.
CCI observed that the proposed transaction relates to the insurance sector in India, which can generally be divided into life insurance, general insurance and reinsurance businesses. CCI assessed the impact of the proposed transaction in the general insurance sector as SFL only provides general insurance through its shareholding in Royal Sundaram.
CCI noted that there was no overlap in the business operations of the SFL and Royal Sundaram and that the general insurance sector was characterized by a number of players in India.
Finally, CCI observed that the vertical relationship between SFL and Royal Sundaram was insignificant and not likely to give rise to any competition concern. Accordingly, CCI approved the proposed transaction, as it was unlikely to cause any AAEC.
For further information, please contact:
Zia Mody, Partner, AZB & Partners
zia.mody@azbpartners.com
Shuva Mandal, Partner, AZB & Partners
shuva.mandal@azbpartners.com
