New Delhi: HDFC Bank's arm HDB Financial Services proposed merger deal with BPO services provider Atlas Documentary Facilitators Company has got the green signal from the Competition Commission of India (CCI).
According to the fair trade regulator, the proposed deal "is not likely to have an appreciable adverse effect on competition in India".
Under an amalgamation agreement, Atlas Documentary and its subsidiary HBL Global Private Ltd would merge with NBFC firm HDB Financial Services.
HBL is engaged in the business of providing specialised Business Process Outsourcing (BPO) services to HDFC Bank -- which is its sole customer.
Further, HDFC Bank also owns 28.99 percent stake in Atlas Documentary.
In an order dated January 12 and released Friday, CCI observed that the deal primarily relates to provision of BPO services in the banking, financial services and insurance (BFSI) sector in India.
The regulator said that "though there is horizontal overlap between the business activities of the parties regarding BPO services, considering the fact that the Parties provide BPO services only to HDFC Bank and other HDFC group companies, the proposed combination is not likely to change the existing market structure for the provision of BPO services, in India".
It also noted that the parties had insignificant market shares in the provision of BPO services in the BFSI sector, in India.
"As regards the provision of financial services, there is no horizontal overlap between the Parties since both HBL and Atlas Documentary provide only BPO services in the BFSI sector," CCI said.
The amalgamation agreement between the companies was entered on November 10, 2014, following which Atlas Documentary had approached CCI for its approval in December.
