Leading commodity bourse MCX today said its board will meet on April 3 to consider allotment of preferential shares, but this move was strongly opposed by its promoter FTIL which said it would take legal recourse to protect the interest of shareholders.
Financial Technologies India Ltd (FTIL), which has plunged into a crisis due to Rs 5,500-crore payment crisis at its group firm NSEL, questioned the timing of MCX's proposed plan to allot preferential shares and said the move is aimed to derail its plan to divest 24 per cent stake in MCX.
"The scheduled meeting of the Board of Directors of the Exchange to be held on April 03, 2014, may, if deemed fit, inter-alia, consider the preferential allotment of shares," the MCX said in a BSE filing.
Earlier, the Board meeting was announced to consider the alteration of main objects Clause of Memorandum of Association and Articles of the Exchange.
Reacting to MCX's proposed plan to allot preferential shares, FTIL said that it has not received such communication from the MCX regarding this proposal.
"FTIL being a holder of 26 per cent shares in MCX has not received such communication and the Board of FTIL will take necessary legal action in the interest of its 65,000 plus shareholders," the company statement said.
FTIL also questioned the timing of the MCX's proposed plan to allot preferential shares saying that the company has already initiated action to divest its stake in MCX up to 24 per cent.
"Such move is vindictive in nature to support certain vested interest and deprive FTIL of its level-playing field to sell its shares," FTIL said.
FTIL said the company has challenged the market regulator Forward Markets Commission (FMC) order that declared FTIL and Jignesh Shah unfit to run any commodity exchanges. FMC had also directed FTIL to reduce its stake to 2 per cent from the existing 26 per cent.
After the payment crisis at the NSEL, the regulator FMC has directed national level bourses including MCX to reconstitute their boards in line with the revised guidelines.
In a statement, FTIL said that it cannot be legally deprived of its rights before the final decision by the Bombay High Court.
"Without prejudicing our rights, FTIL has already announced its commercial decision to divest its equity holding in MCX and received good response from various global and local investors as initial expression of interests.
"It appears that the move by MCX Board is an attempt to derail FTIL's move to divest its equity in fair and transparent manner. FTIL sees such move with a clear agenda of depriving FTIL of its propriety rights at any cost," it said.
MCX shares closed at Rs 490.10, up by 0.93 per cent from the previous day, while FTIL was down by 0.44 per cent to settle at Rs 373.35 on the BSE.
