MCX invites bids to sell stake in MCX-SX, MCX-SX Clearing Corp
In an advertisement on Thursday, MCX said investment bankers and entities interested in buying stake can forward their offers within the next 10 days
Mumbai: Multi Commodity Exchange of India Ltd (MCX), India’s largest commodity futures market by market share, has initiated the process to sell its stake in MCX Stock Exchange Ltd (MCX-SX) and MCX-SX Clearing Corp. Ltd, which it collectively values at ₹ 137.58 crore.
In an advertisement issued on Thursday, the exchange said that it “intends to divest its stake in MCX-SX and MCX-SX Clearing Corp." and investment bankers and entities interested in acquiring stake can forward their offers within the next 10 days.
According to a note with its financial statement for the half year ended 30 September, the commodity bourse holds 27.2 million equity shares—representing a little under 5% stake—and 634.2 million warrants of MCX-SX, along with 6.5 million equity shares of MCX-SX Clearing Corp.
“Based on the latest available financial statements of these companies, the management of the company is of the view that the aggregate carrying amount of investments of ₹ 137.58 crore which is equivalent to the cost of their acquisition represents the fair value of these investments as on 30 September 2014," said the notes with the financial statement, adding that it is in the process of evaluating the said investments.
According to MCX, it was directed by the Securities and Exchange Board of India (Sebi) to divest its stake in MCX-SX and MCX-SX Clearing Corp. as part of the order after the ₹ 5,574.45 crore settlement fraud at the National Spot Exchange Ltd (NSEL). The order barred Jignesh Shah-promoted Financial Technologies India Ltd (FTIL) and MCX from holding any shares in any equity exchange or clearing corporation.
FTIL, which holds 99.99% stake in NSEL, held 26% in MCX at the time of the Sebi order dated 19 March. It later sold its stake to various investors including Kotak Mahindra Bank Ltd and Rakesh Jhunjhunwala. After the sale, MCX wrote to Sebi that it should not be directed to sell its stake in MCX-SX and its clearing corporation, as it was no longer a person acting in concert with FTIL.
The move by MCX also comes close on the heels of FTIL selling its stake in MCX-SX to a clutch of investors, including Jhunjhunwala and Edelweiss Financial Services Ltd for a total consideration of ₹ 88.42 crore. FTIL held 27 million equity shares and 562.5 million warrants in MCX-SX.
On BSE, shares of MCX were trading marginally lower at ₹ 890.40 at 9:37am.
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