MCX promoter Financial Technologies eyes stake in OTCEI, ISE

Financial Technologies, the promoter of the Multi Commodity Exchange of India (MCX), has shown interest in acquiring stakes in the Over the Counter Exchange of India (OTCEI) and the Inter-connected Stock Exchange (ISE). The company had recently applied to the Securities and Exchange Board of India (SEBI) expressing interest in floating a separate stock exchange for small and medium enterprises (SMEs). The company’s move to acquire a stake is seen as a step towards setting up an SME bourse. The OTCEI had placed Financial Technologies’ proposal to buy stake before its promoters and was awaiting their response. The ISE is expected to complete its valuation shortly, with the September 14 deadline for the completion of demutualization process approaching. Apart from Financial Technologies, a few other IT companies and private equity firms are learnt to have approached the exchange to acquire stake. The OTCEI is promoted by financial institutions such as UTI, ICICI, IDBI and LIC, while the ISE is promoted by 13 regional stock exchanges of Bangalore, Kochi, Jaipur, Bhubaneshwar and Mangalore, among others.

Read the Business Standard article.

Goldman Sachs propose to buy stake in Multi-Commodity Exchange

Goldman Sachs has put in a proposal to buy a stake in India’s largest commodity bourse, the Multi Commodity Exchange (MCX). Goldman Sachs already holds a 7% stake in the National Commodity and Derivatives Exchange Limited (NCDEX). The MCX stake would be considered as an investment and not a strategic acquisition. The New York Mercantile Exchange, London Metal Exchange and The Tokyo Commodity Exchange have also initiated talks with MCX. The talks were being initiated ahead of the publication of final guidelines on foreign shareholding in Indian commodity exchanges. The idea is to firm up plans in readiness for the guidelines. The Forward Markets Commission has told all commodity exchanges not to change shareholding patterns until the new guidelines are issued. The shareholders of MCX include Financial Technologies Limited, State Bank of India and its associates, National Bank for Agriculture and Rural Development (NABARD), National Stock Exchange of India, Fidelity International, Corporation Bank, Union Bank of India, Canara Bank, Bank of India, Bank of Baroda, HDFC Bank and SBI Life Insurance.

Read the Business Standard article.

MCX may divest stake to Dubai Multi Commodities Centre

The Dubai government-owned Dubai Multi Commodities Centre (DMCC) may buy stake in Multi Commodity Exchange (MCX). DMCC would initially pick up a minor ownership in the MCX and later increase it following MCX’s initial public offering (IPO).

MCX is planning an IPO to raise about Rs. 300 crores. US-based New York Mercantile Exchange was reportedly eying a 9% stake in MCX for about $60 mn. In early 2006, foreign institutional investor Fidelity International had picked up more than 9% in MCX for $49 mn. Currently, the major shareholders of MCX, other than its promoter Financial Technologies, are State Bank of India, NABARD, the National Stock Exchange, Union Bank, Canara Bank, Bank of India, Bank of Baroda, HDFC Bank and SBI Life Insurance.

DMCC, MCX and Financial Technologies had together set up the Dubai Gold and Commodity Exchange, which had commenced trading more than a year back. Recently, the New York Stock Exchange Group, General Atlantic, Goldman Sachs and Softbank Asian Infrastructure Fund bought 5% each in the National Stock Exchange (See Related Post).

Read more on this in DNA Money.