Competition Commission of India approves Reliance Infrastructure and Dassault Aviation's joint venture

Competition Commission of India (CCI) on Monday gave its nod to the joint venture between Reliance Infrastructure's Reliance Aerostructure and France-based Dassault Aviation. 

On October 03, 2016, Anil Ambani-backed Reliance Infrastructure signed a joint venture agreement with Dassault Aviation to focus on promoting research and development projects under the IDDM program.

Anil Ambani, Chairman of Reliance Group had said, " “We are delighted to partner a world leader in aviation like Dassault Aviation, and a visionary leader like Eric Trappier. This is a transformational moment for the Indian Aerospace sector and for Reliance Infrastructure’s subsidiary Reliance Aerospace."

The JV will be named as 'Dassault Reliance Aerospace', where Reliance Aerostructure will hold 51% of shareholding and Dassault Aviation with 49%. 

This deal is considered as key in execution of offset obligations, as a part of the 36 Rafale fighter Jets purchase agreement worth €7.87 billion, or about Rs.59,000 crore, signed between France and India on September 23, 2016. 

Agreement includes a 50% offset obligation which is the largest ever offset contract in the history of India. Thus, it is expected that  will bring in direct business worth around Rs 22,000 crore.

Shares of Reliance Infrastructure and Reliance Defence surged on BSE after the announcement. 

At 12.40 pm, share price of Reliance Infrastructure was trading at Rs 544.40 per piece above 2.14%. And that of Reliance Defence at Rs 59.70 per piece higher by 1.26%.