CCI Approves Honda’s Acquisition of Additional Voting Interests in Astemo

On 23 June 2026, the CCI approved[1] Honda Motor Co. Ltd.’s (Honda) acquisition of an additional 21% voting interest in Astemo Ltd. (Astemo) from Hitachi Ltd. (Hitachi). The transaction was notified pursuant to a share purchase agreement (SPA) between Honda and Hitachi and a shareholders’ agreement between Honda, Hitachi and JICC-01 Investment Business Limited Partnership (JICC-01).

Transaction Structure

The transaction increased Honda’s voting interest in Astemo from 40% to 61%, resulting in a change in the degree of control. Astemo had been under the joint control of Honda, Hitachi and JICC-01 since October 2023.

Parties to the Transaction

Honda, the flagship company of the Honda Group, manufactures and sells the following in India:

• Automobiles and passenger vehicles (PVs)
• Two-wheelers (TWs)
• Power products
• Automotive components

Astemo manufactures and sells automotive and power product components. For the CCI’s assessment, Honda and its relevant affiliates comprised the Acquirer Group, while Astemo and its relevant affiliates comprised the Target Group.

CCI’s Competitive Assessment

The CCI identified no horizontal overlaps but identified vertical linkages between the Target Group’s upstream supply of automotive and power product components and the Acquirer Group’s downstream manufacture and sale of PVs, TWs and power products in India. The CCI assessed 19 upstream and three downstream markets.

The Target Group supplied components to Original Equipment Manufacturers (OEMs), including Honda Group entities. Honda manufactured PVs and TWs through the following entities:

• Honda Cars India Limited (PVs)
• Honda Motorcycle and Scooter India Pvt. Ltd. (TWs)
• Honda India Power Products Ltd. (power products)

Vertical Linkages in Automotive Components

The CCI noted that the Target Group was already under Honda’s common control and would remain under its joint control post-transaction. The upstream markets had established competitors and sophisticated OEMs with significant countervailing buyer power.

Although Honda had a relatively higher presence in the TW segment, it faced strong competitors, including:

• Hero MotoCorp
• Bajaj Auto
• TVS Motor Company

Honda’s relatively low presence in the PV segment and competition from Maruti Suzuki, Hyundai, Tata Motors and Mahindra limited foreclosure concerns. The CCI therefore found that the transaction would neither change the parties’ incentives nor alter the competitive landscape.

Vertical Linkages in Power Products

With respect to the power product vertical linkages, the CCI noted that, despite the parties’ presence in the relevant upstream and downstream markets, the procurement and sales activities between the Acquirer Group and Target Group were captive intra-group transactions. As these supplies were confined within the group, the CCI found that the transaction did not raise concerns of customer or input foreclosure.

Relevant Market Definition and Outcome

Considering the existing control structure, competitive constraints and captive nature of the power product supplies, the CCI left the precise relevant market definition open and found that the proposed combination was unlikely to cause an AAEC in India. Accordingly, the CCI approved the proposed combination under Section 31(1) of the Competition Act.

Business Takeaway

The decision highlights that an increase in voting rights can trigger merger control assessment where it changes the degree of control, even where the target is already within the acquirer’s group. Businesses should therefore assess whether changes in voting interests alter existing control arrangements when undertaking shareholder restructurings.

[1] CCI: Notice under Section 6(2) of the Competition Act, 2002 given by Honda Motor Co., Ltd., Combination Registration No. C-2026/04/1411, order dated 23 June 2026.

Last Updated on 21 August, 2026