As per the deal, Ruias-promoted Essar Steel will transfer its gas plant located at Hazira, Gujarat to Inox on a slump sale basis.
In an order dated January 30, the Competition Commission of India (CCI) said that "the proposed combination is not likely to have an appreciable adverse effect on competition in India".
The Commission noted that in terms of a agreement between Essar Steel and Inox, a guaranteed quantity of the industrial gases produced at the Hazira gas plant Essar Steel "on job work and long term basis, would be provided to Essar Steel, by Inox AP, post combination".
"The proposed acquisition of the gas plant at Hazira, will also not increase, in any significant manner, the capacity of Inox AP for producing and selling industrial gases, in India," CCI said in the order.
Essar Steel, as part of its business activity of steel manufacturing has a gas plant which produces oxygen, nitrogen, and argon gases.
The gases produced in the units located at Hazira plant are primarily used for the purpose of captive consumption in steel manufacturing by Essar Steel.
Inox Air Products is engaged in the business of manufacturing and supplying industrial gases across India.
Pursuant to execution of a 'Business Transfer Agreement (BTA)' with Essar Steel on December 24, 2013, Inox has sought clearance of the deal with CCI.