CCP approves UAE firm's stake in Masood Textile Mills

The Competition Commission of Pakistan (CCP) has approved the acquisition of a stake in Masood Textile Mills Limited by UAE-based Velora Global Ventures-F.Z.C., clearing a change in ownership at a Pakistani textile manufacturer. The approval was reported by TechJuice.

Velora is acquiring the shares from two Chinese companies, Shanghai Challenge Textile Company Limited and Zhejiang Xinao Industry Company Limited, under a Share Purchase Agreement. The CCP reviewed the transaction under a Phase-I competition assessment in accordance with the Competition Act, 2010.

Under the law, the Commission can clear a merger at Phase I if it determines the deal does not substantially lessen competition. The CCP found that Velora had no existing market presence in Pakistan, so the acquisition was not expected to materially affect Masood Textile Mills' output, domestic sales or market position.

The Commission also examined potential vertical links between Velora's international textile trading activities and Masood Textile Mills' manufacturing operations. It concluded that the relationship was unlikely to create competition concerns, new entry barriers, or a significant increase in market power.

The CCP authorised the transaction under Section 31(1)(d)(i) of the Competition Act, 2010. In its statement, the Commission said its merger-review process aims to provide regulatory certainty, facilitate foreign investment and business expansion, and protect competitive markets in Pakistan.

A Phase-I clearance allows the transaction to proceed without a detailed Phase-II investigation. The announcement did not specify the size of the stake or the financial terms of the share purchase.