No buyers for Ludhiana bourse stake

The Ludhiana Stock Exchange (LSE) is finding it hard to offload 51 per cent stake, required under the demutualisation scheme, due to lack of equity trading facility and a proper business model.

"Even as we decided to divest 51 per cent stake of members through strategic sales route, we have been unable to find any strategic partner as we do not have any equity trading or a proper business model to attract the attention of partners," Ludhiana Stock Exchange Executive Director HS Sidhu said.

The LSE has to ensure that by September 14 at least 51 per cent of its shares are held by public other than the shareholders having trading rights in accordance with Securities Contract (Regulations) Act, 1956.

The 15-member disinvestment committee formed by LSE had been scouting for strategic partners for quite some time but failed to attract any taker.

LSE has the option of disinvesting through an IPO but it fears that it may remain under subscribed. LSE has a paid-up capital of Rs 6,02,000.

It had requested the Securities and Exchange Board of India (SEBI) to extend the deadline of September 14 by six months. But the proposal was not approved by the market regulator.

Equity trading at the bourse came to an end on January 23, 2002. Rental income accounts for a major part of the total income of the exchange.