Dixon Tech Gets CCI Nod To Acquire Aditya Infotech

The Competition Commission of India (CCI) has approved Dixon Technologies (India) Ltd’s proposal to acquire a 6.5% stake in Aditya Infotech Ltd. Dixon Technologies, is known for its Electronic Manufacturing Services (EMS) business. The company provides solutions for products such as televisions, lighting, washing machines, and security systems.

Transaction Details

In July 2024, Dixon Technologies announced plans to divest its entire 50% stake in the joint venture (JV) company, AIL Dixon Technologies Pvt Ltd, to Aditya Infotech. AIL Dixon, a partnership between Dixon and Aditya Infotech, specializes in the manufacturing and assembly of Energy Storage Systems (ESS). The joint venture reported a revenue of Rs.632.62 crore in FY24.

As part of the agreement, Dixon will acquire a 6.5% stake in Aditya Infotech in exchange for divesting its share in the JV as it aligns with Dixon’s broader business strategy to refocus on its operations and portfolio.

Regulatory Clearance

The transaction required clearance from CCI, as the deal exceeded the threshold limits. CCI plays a critical role in monitoring mergers and acquisitions to ensure fair competition in the marketplace. On X, the regulator stated, “Commission approves the subscription of certain shares of Aditya Infotech Ltd (AIL) by Dixon Technologies India Ltd and the acquisition of certain shares of AIL Dixon Technologies Pvt Ltd by AIL.”

Aditya Infotech & Financials

Aditya Infotech, an unlisted public company, is primarily involved in sourcing, distributing, and marketing electronic security systems under the CP Plus brand. For FY23, Aditya Infotech recorded a revenue of Rs.2,298 crore.

Conclusion: In conclusion, the CCI’s approval is crucial for transactions of this magnitude, promoting fair competition and ensuring no undue advantage is gained by any party. As Dixon Technologies divests its stake in AIL Dixon, acquiring a stake in Aditya Infotech allows it to refocus on business interests, all while maintaining a balanced marketplace.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.