New Delhi: Fair trade regulator CCI has approved auto major Mahindra and Mahindra's proposal to fully acquire commercial vehicle producer Mahindra Navistar Automotives, saying the deal does not raise anti-competition concerns.
Mahindra and Mahindra (M&M) would buy the remaining 49 per cent stake in the joint venture with US-based Navistar International Corp. The 49 per cent stake is held by Navistar's indirect subsidiary International Truck and Engine Mauritius Holding (IMH).
In its order dated February 4, Competition Commission of India (CCI) observed that the proposed deal "is not likely to have an appreciable adverse effect on competition in India".
Following the acquisition, Mahindra Navistar -- which is engaged in business of designing, developing and sale of light, medium and heavy commercial vehicles -- would become a wholly owned subsidiary of Mahindra and Mahindra (M&M).
CCI observed that both M&M and Mahindra Navistar operate "in different segments of the commercial vehicle market in India" and would therefore not have an adverse impact on competition.
M&M and its affiliates manufacture and sell passenger cars, commercial vehicles and two/three wheelers. While IMH a subsidiary of US-based Navistar is into investment holding activities.
However, other subsidiaries and affiliates of Navistar produce international brand commercial and military trucks, MaxxForce brand diesel engines among others.
CCI said that apart from its stake in Mahindra Navistar, Navistar is not engaged in business activities in India and following the deal, "both M&M and Navistar would operate in different geographical territories in manufacturing, designing or sale of light, medium and heavy commercial vehicles".
M&M and Navistar had reached the deal in January last year, following which a notice was filed with CCI for its approval.