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According to a source familar with the development, FTIL is likely to move court to stop transfer of its shares into an escrow account, as only 20 per cent of the total shareholders have voted and approved the resolutions. The high court had suggested earlier to FTIL that in such an eventuality, the company could approach the court.
The move follows a directive last month from the regulator, the Forward Markets Commission, wherein it had said any shareholder declared ‘not fit and proper’ should dispose of their shares, failing which the commodity exchange in question would have the power to put these in escrow and dispose as decided by its board of directors.
This is, however, unprecedented; it has never been done before. FTIL had earlier warned MCX against any such move and also filed a petition in the high court here; however, the HC declined to stay FMC’s directives.
FMC declared FTIL ‘not fit and proper’ to be an anchor investor in any comex last December. The latter initiated a stake sale process but had not got any binding offers. Meanwhile, its chairman and group chief executive is under judicial custody in the National Spot Exchange default payments case, also the reason why FMC moved against it.
One of the reason for the delay from FTIL in stake sale has been renegotiation of the technology supply contract it has with MCX. This contract was termed one-sided in a special audit, favouring FTIL. It was for 33 years, with stringent exit clauses. FMC had asked MCX to complete re-negotiations of the contract by June-end. Sources said the potential bidders might be waiting for these to conclude.
MCX disclosed the results of its shareholder ballot on the BSE. FTIL, with 26 per cent stake, was not allowed to participate, citing new FMC directives. Nearly 20 per cent of the total shareholders or 27 per cent of the non-FTIL shareholders participated in the voting for two resolutions and both were approved by around 95 per cent voting in favour. First resolution was giving powers to sell stake of shareholder not fit and proper while second was amendment in the article of association by which MCX will not enter business of securities not in the eco-ventures related to the exchange business. Both have been approved. However 3 shareholders have not favoured the second resolution.
