Fair trade regulator clears merger of Alstom, Kalyani Group JV firms

Fair trade regulator Competition Commission of India has approved the proposed merger of two companies jointly owned by French major Alstom and industrial player Kalyani Group. The transaction involves the absorption of Kalyani Alstom Power into Alstom Bharat Forge Power, which will be the surviving company.

 

Both entities are jointly controlled by Alstom Power Holdings SA and Bharat Forge Ltd, the flagship firm of the Kalyani Group.

 

The CCI said in a December 10 order that "the proposed combination is not likely to have appreciable adverse effect on competition in India".

 

The regulator observed that after the deal, ultimate control over Alstom Bharat Forge Power would remain jointly with Alstom Power Holdings and Bharat Forge.

 

Alstom holds a 51 per cent stake in Alstom Bharat Forge Power, a maker of steam turbines and generators, while the rest is with Bharat Forge.

 

Bharat Forge has a 51 per cent stake in Kalyani Alstom Power, while the remaining stake is held by Alstom. Kalyani Alstom makes heat exchangers and auxiliary equipment for steam turbine generators.

 

The regulator noted there was "no horizontal overlap" between the business activities of the two companies.

 

"The products of ABFPL (Alstom Bharat Forge Power Ltd) and KAPL (Kalyani Alstom Power Ltd) would be complementary to each other for the setting up of turbine islands for sub-critical and super-critical technology based power plants," it said.

 

"However, KAPL has not started any business activity and has also stopped construction of its manufacturing plant and ABFPL has also not supplied any products to KAPL."

 

Besides, Alstom Bharat Forge Power's manufacturing facility is scheduled to start in 2015, the CCI noted.

 

Both companies' boards approved the merger in October, following which the CCI's clearance was sought.