NMCE initiates process to sell 26% stake to BSE

Ahmedabad-based National Multi Commodity Exchange (NMCE) has initiated the process to sell 26 per cent stake to Bombay Stock Exchange through issue of fresh equity after receiving commodity market regulator FMC's nod.

"We are in the process (of selling 26 per cent stake). We hope it will be completed soon," an NMCE official said.

He said the commodity exchange would be restructured once the paper work was completed and there were several other plans to expand its activities. Among other things, the commodity exchange may launch an electronic spot exchange, similar to that of rival bourses Ncdex and MCX, he added.

However, it depends on the investment the new promoter will make on the expansion plan, the official said.

"We have allowed them (NMCE) to sell 26 per cent stake to BSE. But it should be fresh equity and not from divesting stakes of any of the promoters," Forward Markets Commission Chairman B C Khatua said.

The condition of fresh equity has come even as there was speculation that Neptune Overseas, the founder promoter of NMCE, wanted to sell its 26 per cent stake to BSE. The other major shareholder of the exchange is Central Warehousing Corporation (CWC) with 26 per cent equity.

Early this month, the Consumer Affairs Ministry had cleared FMC's proposal regarding the stake sale in NMCE. FMC had sought government's permission in the absence of any guidelines for commodity exchanges.

BSE's stake in NMCE would be highest by any stock exchange in any commodity exchange after the sale process gets completed. The National Stock Exchange has 15 per cent stake at leading agri commodity bourse NCDEX.

NMCE's other shareholders are Nafed and state-run Punjab National Bank.

Rubber, cardamom and pepper are the main commodities traded on NMCE. The turnover of the exchange for the first fortnight of September stood at Rs 607.40 crore.