Existing institutional shareholders are likely to hold a total of 20 per cent in the bourse.
The MCX Stock Exchange (MCX-SX) would offload 47 per cent of its stake in the next two months with the intention to mop up around Rs 3,000 crore, a senior merchant banker said on Monday. MCX-SX, promoted by Financial Technologies, currently runs only currency derivatives trading and is awaiting approval from the Securities and Exchange Board of India (Sebi) to start trading in equities.
“Banks are speaking to several investors to offload 47 per cent stake of MCX-SX. The talks are at an advanced stage and we hope to complete the process in the next two months,” said Rakshad Kapoor, investment banking head of Antique Capital Market.
IFCI had recently bought 5 per cent from Financial Technologies. The valuation of the stock exchange worked out to be $1.25 billion (Rs 6,300 crore), Kapoor said, adding the 47 per cent stake sale will fetch about Rs 3,000 crore. The sale is being done to comply with regulatory requirements. MCX-SX went online in October 2008.
“The divestment process of MCX-SX has been initiated and will be completed in a couple of months to meet regulatory requirements,” MCX-SX Managing Director and CEO Joseph Massey had said earlier. “So far, we have finalised around 30 per cent divestment with banks and institutions such as Andhra Bank, Union Bank, Bank of India and IFCI,” Massey said. Last week, MCX-SX signed a cooperation agreement with FTSE, the world’s leading index provider, to create a series of domestic indices and to bring the latter’s global indices, such as the FTSE 100, to the Indian market. Company officials declined to comment whether FTSE, jointly owned by the Financial Times Group and London Stock Exchange, would pick up stake in MCX-SX in near future.
Under Sebi regulations, no single shareholder can have more than five per cent stake in a stock exchange. Though the limit has been fixed at 15 per cent for some categories of financial institutions (domestic banks, depositories, insurance companies and clearing corporations).
As part of the divestment process, the existing institutional shareholders are likely to hold a total of 20 per cent stake in MCX-SX, 33 per cent has already been divested and another 47 per cent has to be divested.
The entire divestment would be done through the current process of negotiated deals with no possibility of a public offer. MCX has appointed three consultants — Nomura Securities, Deutsche Bank and Antique Capital Markets — for divestment.
