CCI approves Nestlé joint venture and JSW Energy acquisition

CCI approves Nestlé and PAI joint venture
CCI approves JSW Energy's acquisition of JSPL's power plant

CCI approves Nestlé and PAI joint venture

By way of a July 1 2016 order,(1) the Competition Commission of India (CCI) approved a joint venture between Nestlé and PAI Partners SAS (through Riviera Topco). Pursuant to the implementation agreement between Nestlé and Riviera Topco, the joint venture will be jointly controlled by Nestlé and PAI and principally active in:

• the production, distribution and sale of ice cream products in certain geographical areas; and
• to a limited extent, the production and sale of other frozen food products in certain European Economic Area (EEA) countries, as well as chilled dairy products in the Philippines.

The following businesses will be transferred by Nestlé to the joint venture:

• Nestlé's ice cream businesses located in Europe, the Middle East, North Africa (excluding Israel) and certain other geographical areas, including Argentina, Brazil and the Philippines;
• some of Nestlé's frozen food businesses in certain EEA countries;
• Nestlé's chilled dairy business in the Philippines; and
• certain logistics services in Russia, Switzerland and Italy in relation to frozen pizza.

Further, R&R Ice Cream plc (a subsidiary of PAI) – a public limited company headquartered in the United Kingdom engaged in the ice cream market in the United Kingdom, certain EEA countries, South Africa and Australia – will be transferred by PAI to the joint venture. R&R Ice Cream has no business activities or operations in India.

The joint venture will be operational in India only through export sales of Nestlé's ice cream brand Mövenpick of Switzerland. PAI is not (directly or through its portfolio companies) present in the Indian ice cream market. Accordingly, apart from Mövenpick export sales, the joint venture will not be active in India.

CCI approves JSW Energy's acquisition of JSPL's power plant

Through a July 1 2016 order,(2) the CCI approved JSW Energy's acquisition of a 1,000-megawatt (mw) power plant in Chhattisgarh from Jindal Steel and Power Ltd (JSPL). JSPL's board had approved the divestiture of its subsidiary Jindal Power Ltd (JPL) into a special purpose vehicle (SPV) in order to transfer it to JSW Energy, pursuant to the execution of a securities purchase agreement between JSW Energy, JPL, Everbest Steel and Mining Holdings Limited and Jindal Steel and Power Limited. The proposed combination was for:

• the transfer of a 1,000 mw operational coal-fired thermal power plant in Tamnar, Chhattisgarh owned by JPL to the SPV on a going-concern basis pursuant to a scheme of arrangement between JPL, JSPL and the SPV; and
• the subsequent acquisition of a 100% stake in the SPV by JSW Energy.