India's antitrust body on Thursday raided the local unit of French firm Mersen SA and an Indian company over allegations they colluded on prices of equipment supplied to Indian Railways, two sources told Reuters.
The Competition Commission of India (CCI) conducted raids at Mersen's two offices in Bengaluru and at the offices of Assam Carbon Products in Hyderabad and Kolkata, one of the sources said.
The raids mark only the fifth such search operation in CCI's 10-year history. They can only be conducted with approval from a judge.
The raids followed a review of a complaint by the federal railways department which alleged the two companies had colluded over pricing of carbon brushes before submitting their bids. Such brushes are used in electric motors.
"Both of them were fixing prices, they did bid rigging to inflate prices," said one of the sources who is aware of the allegations made by the Indian Railways.
"Mersen is fully cooperating with the Indian authorities. As the investigation is ongoing, Mersen will not further comment," Mersen said in an emailed statement to Reuters.
Repeated calls to the offices of Assam Carbon Products went unanswered. Indian Railways and the CCI did not respond to requests for immediate comment.
Shares of Mersen - a specialist in electrical power and advanced materials with a market capitalisation of 685 million euros - were down more than two percent in early trading on the Paris bourse on Friday.
About 30 antitrust officials were involved in searches at the offices of the two firms which began on Thursday and are likely to continue for about 24 hours, one said source. Some company executives were also questioned.
The CCI has conducted a number of raids involving global corporations since last year. In March, it raided units of global commodities trader Glencore. Earlier it conducted raids at the offices of global brewers such as Carlsberg and Anheuser Busch InBev.
Both of those investigations are still ongoing.