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MCX-SX to divest 50% stake much before deadline

MCX-SX to divest 50% stake much before deadline
PTI
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First Published: Fri, Sep 04 2009. 05 26 PM IST
Updated: Fri, Sep 04 2009. 05 26 PM IST
New Delhi: MCX Stock Exchange (MCX-SX) on Friday said it would divest 50% of the stake held by the promoters “much before” the extended deadline of 15 September 2010, to meet the requirements of market regulator Sebi.
“We are confident of doing it (divestment) much before September 2010. There’s roughly 50% more to divest,” MCX-SX chairman Ashok Jha told reporters after signing an agreement with industry body Assocham to promote the SMEs.
The duo agreed to promote small and medium enterprises (SME) sector for which MCX-SX has sought an approval from the Sebi to either set up a separate segment in the bourse or establish a different stock exchange for the SMEs.
The Securities and Exchange Board of India needs MCX-SX, which went online last October and runs currency derivatives trading, to meet the divestment requirement of no single entity owning over 5% stake barring exceptions.
“Once we meet the divestment requirement of Sebi, we can start trading in interest rate futures,” Jha said, adding they would be interested in all other products also. The exchange is waiting for regulatory approvals to start equity trading.
The exchange’s promoters, Financial Technologies (India) Ltd and commodity bourse Multi Commodity Exchange (MCX), have already divested 30% stake in the stock exchange to various public and private banks and institutions, he said.
The deadline to get more investors for India’s third largest national level exchange earlier was September 2009 which they failed to meet due to market conditions. “We did not divest because the capital market was in deep turmoil,” Jha said.
As per Sebi norms, no single entity can hold over 5% in an exchange barring some like stock exchanges and banking organisations that can hold up to 15% stake.
After meeting the divestment requirement, the exchange’s promoters are likely to jointly hold 20% stake.
Financial Technologies is expected to hold 5% stake and parent company-cum-commodity bourse MCX is likely to hold 15% stake in MCX-SX.
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First Published: Fri, Sep 04 2009. 05 26 PM IST