CCP Approves Merger of Junaid Jamshed with U&I Garments

The Competition Commission of Pakistan (CCP) has given the green light to the proposed merger between Junaid Jamshed (Private) Limited (JJPL) and U&I Garments (Private) Limited (U&I). This was revealed in an official statement released by the CCP on Tuesday.

U&I and JJPL had jointly submitted the merger application, seeking the CCP’s authorization for U&I to acquire JJPL’s entire business through a share swap arrangement. Upon completion of this transaction, JJPL will be dissolved as an independent legal entity. Its complete operations, encompassing assets and liabilities, will be absorbed into U&I.

To evaluate the potential impact of the proposed merger, the CCP performed a Phase-I competition assessment. This review focused on determining if the merger would lead to the creation or reinforcement of a dominant market position within relevant sectors, including ready-made clothing, footwear, accessories, perfumes, and beauty products.

The CCP release stated that the merger is essentially a consolidation within the same group, given that U&I already possesses a 25% ownership stake in JJPL.

The Commission concluded that the transaction is unlikely to significantly diminish market competition in any of the relevant sectors. This determination was based on factors such as limited overlap between the merging entities, low barriers to entry for new competitors, and the presence of a significant number of other participants in the market.

Consequently, the CCP has sanctioned the merger in accordance with Section 31(1)(d)(i) of the Competition Act, 2010.