CCI Approves Purchase of Stake in Hero Future Energies Global by Ardor Holdings II Pte Ltd.

CCI Approves Purchase of Stake in Hero Future Energies Global by Ardor Holdings II Pte Ltd.

The competition regulator Competition Commission of India (CCI) approved the purchase of stake in Hero Future Energies Global Ltd by Ardor Holdings II Pte Ltd.

This is the first set of merger clearances by the CCI after the 108 days hiatus since October 2022.

Ardor Holdings II Pte. Ltd. (Purchaser) is a special purpose vehicle, indirectly wholly-owned by investment funds, vehicles, and/ or accounts advised and managed by various subsidiaries of KKR and Company Inc. (KKR and Co. and together with its subsidiaries, KKR).

Hero Future Energies Global Limited (Target) is a private company incorporated in England and Wales. The Target's principal business activity is setting up/ acquisition of plants/ projects engaged in solar power generation and wind power generation.

The CCI granted an unconditional approval of the subscription of Compulsorily Convertible Preference Shares of Hero Future Energies Global Limited by Ardor Holdings II Pte. Ltd.

The Target operates in India through Hero Future Energies Private Limited (HFE India), a company incorporated under Indian Companies Act, 1956, is a wholly-owned subsidiary of Hero Future Energies Asia Pte. Ltd (with only one equity share held by Target as a nominee of Hero Future Energies Asia Pte. Ltd), which is 100% held by the Target. HFE India is primarily engaged in the implementation of power projects and renewable power generation of energy, specifically solar and wind power generation.

CCI mandates that deals beyond a certain threshold must be approved by CCI, which keeps a tab on unfair business practices as well as promotes fair competition in the marketplace.

Section 5 of the Competition Act sets out thresholds for enterprises and groups, in terms of assets and turnover, which if exceeded triggers a requirement to notify to the CCI. Not every Merger and Acquisition activity requires notification to the Commission. As per Section 6(2) of the Competition Act, only combinations require notification to and approval of the Commission prior to their consummation.

The proposed combination relates to the Purchaser's subscription of Compulsorily Convertible Preference Shares (CCPS) in the Target, and their subsequent conversion into equity shareholding in the Target. (Proposed Combination).