CCI Approves Ashoka Buildcon's Acquisition of 34% Stake in Ashoka Concessions Ltd

The Competition Commission of India (CCI) has given the green light to Ashoka Buildcon's plan to acquire the remaining 34% stake in Ashoka Concessions Ltd (ACL). Currently, Ashoka Buildcon Ltd (ABL) holds a 66% stake in ACL. With CCI's approval, ACL will become a fully-owned subsidiary of Ashoka Buildcon.

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In October 2024, ABL announced its intention to purchase all investments from investors in ACL for approximately Rs 1,526 crore. The company has also signed a share purchase agreement with Macquarie SBI Infrastructure Investments and SBI Macquarie Infrastructure Trust to acquire the remaining 34% equity shares in ACL.

Infrastructure Expansion and Investment

Ashoka Buildcon is involved in engineering, procurement, and construction (EPC) across various sectors. It also manages roads and highways through models like EPC, Build Operate and Transfer (BOT), and Hybrid Annuity Model (HAM). The acquisition includes certain convertible instruments of ACL by ABL and Viva Highways, a subsidiary of Ashoka Buildcon.

Viva Highways will also acquire a 26% stake in Jaora Nayagaon Toll Road Company (JN) from investors for Rs 150 crore. JN is a BOT concessionaire granted a concession by the Madhya Pradesh Road Development Corporation for work on state highway SH-31.

Regulatory Approval and Market Competition

The CCI's approval is crucial as it ensures fair competition in the marketplace and monitors against unfair business practices. Deals exceeding specific thresholds require such regulatory consent. This acquisition aligns with ABL's strategy to consolidate its infrastructure projects under one umbrella.

ACL serves as the infrastructure arm of the Ashoka Group, focusing on road and highway operations in India through its subsidiaries. It was established by ABL to centralise various BOT-based road projects.

The CCI stated on X that it approves the acquisition of 34% equity shareholding of Ashoka Concessions by Ashoka Buildcon. Additionally, it approves certain convertible instruments of ACL by ABL and Viva Highways, along with a 26% shareholding of JN by Viva.

This strategic move by Ashoka Buildcon aims to strengthen its position in the infrastructure sector. By acquiring full control over ACL, the company can streamline operations and enhance its project management capabilities.