MCX-SX to sell 47 pc stake; may fetch Rs 3,000 cr

MCX Stock Exchange (MCX-SX) will offload 47 per cent of its stake in the next two months to mop up around Rs 3000 crore, a senior merchant banker said today.
       
MCX-SX, promoted by Financial Technologies (India) Ltd, currently runs only currency derivatives trading and is awaiting Sebi approval to start trading in equities.
       
"Banks are speaking to several investors to offload 47 per cent stake of MCX Stock Exchange. The talks are at an advanced stage and we hope to complete the process in next two months period," Antique Capital Market, investment banking head, Rakshad Kapoor, said.
       
Out of 52 per cent stake, IFCI recently bought 5 per cent from Financial Technologies. The valuation of the stock exchange works out at $1.25 billion (Rs 6,300 crore), Kapoor said, adding 47 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 earlier said.
       
"So far, we have finalised around 30 per cent divestment with banks and institutions like 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.
       
The 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 the Securities and Exchange Board of India (Sebi) regulations, no single shareholder can hold more than five per cent stake in a stock exchange. For some categories of financial institutions (domestic banks, depositories, insurance companies and clearing corporations), the limit has been fixed at 15 per cent.
       
As part of the divestment process, the existing shareholding institutions 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 and there would be no possibility of public offer.
       
MCX has appointed three consultants - Nomura Securities, Deutsche Bank and Antique Capital Markets - for divestment.
       
The MCX-Financial Technologies combine runs 10 exchanges across various asset classes such as bullion, crude, currency and power, in India and overseas.