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Japanese auto component maker Denso Corporation’s proposed joint venture with Pricol has been cleared by the Competition Commission of India.
The Coimbatore-based automotive instruments and precision engineering company Pricol plans to transfer its Denso Technology Instrument Cluster undertaking to a wholly-owned subsidiary, Pricol Components Ltd.
As per the agreement, upon the transfer, Denso will acquire 51 per cent stake in PCL.
“The proposed combination is not likely to have an adverse effect on competition in India and, therefore, the Commission hereby approves the proposed combination under... (Competition) Act,” CCI said in its order.
Denso Technology Instrument Cluster Undertaking services companies manufacturing four-wheeler personal passenger vehicles from locations in Coimbatore and Gurgaon. Pricol manufactures an array of auto parts, including instrument clusters, speedo cables, sensors, accessories and sub-assembly components, oil pumps, idle speed control valve assembly and vehicle security systems.
Its clients include players in the auto space, including two-wheeler and HCV makers, and a major portion of its business comes from the instruments segment.
The CCI said “there is no horizontal overlap between the products of Denso and Pricol” as neither the Japanese firm nor its affiliates in India are engaged in the business of manufacturing/supply of instrument clusters for four-wheeler personal passenger vehicles, two-wheeler vehicles and commercial vehicles.
Denso had approached the CCI for its approval following the joint venture agreement on February 14.
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