On November 1, 2018, CCI approved the proposed acquisition of 50% of Alstom S.A.’s (‘Alstom’) share capital by Siemens Aktiengesellschaft (‘Siemens’), filed under Section 6(2) of the Act.[1] The proposed combination relates to the combination of Alstom and the mobility business of Siemens by way of a contribution of Siemens’s mobility business to Alstom. This contribution of Siemen’s mobility business to Alstom is in consideration for newly issued Alstom shares (representing 50% of Alstom’s share capital) on a fully diluted basis (‘Proposed Combination’).

In India, Siemens provides services concerning transportation of people and goods by rail and road and operates through its three subsidiaries which are part of the Proposed Combination. Further, Alstom is engaged in the business of products, services and solutions relating to mobility business. It manufactures and supplies signaling systems, rolling stock (including locomotives), rail electrification, track works, maintenance services and also provides associate construction and engineering services through its subsidiaries.

CCI considered the wide product portfolio of Alstom and Siemens and segmented the product market for assessment, without defining it, as:

i.       Signaling solutions (systems providing safety controls on mainline and urban rail networks);

ii.     Rail electrification (power supply and contact line systems for urban mainline railways);

iii.    Rolling stock (trains including locomotive, mainline stock such as intercity and regional trains and urban rolling stock such as metros).

This was done since both Alstom and Siemens competed in tenders only in the above-mentioned products/services. However, as mentioned above, the relevant product and geographic market definition was left open by CCI for all the three segments since the Proposed Combination did not raise any competition concerns irrespective of the manner in which the market is delineated. CCI approved the Proposed Combination since the CCI held that it will not have any appreciable adverse effect on competition in any of the relevant markets after considering: (i) the combined market share of the relevant parties; (ii) other players in the market competing for and winning bids; and (iii) third party responses on the other credible and big competitors in the market.

[1] Combination Registration No. C-2018/07/588.