Financial Technologies (FTIL), which is already under the scanner of various regulatory agencies for its alleged role in the Rs 5,600 crore settlement crisis at the National Spot Exchange (NSEL), has appointed a committee that will oversee a restructuring plan for the company.
The committee, among other things, will also look at the option of the company divesting up to 24% of its stake in Multi Commodity Exchange (MCX), as mandated by an order by the Forward Markets Commission (FMC).
ďThe restructuring plan shall also include FTIL divesting up to 24% in MCX Limited in the long-term interest of both FTIL and MCX. The committee may also consider divestment of FTILís investment in other exchanges as a part of the restructuring. The decision is without prejudice to the legal rights and remedies of the company,Ē said a release issued by FTIL late on Thursday.
In an order issued in December 2013, FMC ruled that FTIL is not a 'fit & proper' entity to be an anchor shareholder in any exchange and so it needs to reduce its stake in MCX from the current 26% to 2%. FTIL has challenged the FMC order at the Bombay High Court.
According to the company, the committee will comprise of two non-executive independent directors -- Venkat Chary and S Rajendran -- along with legal advisor Berjis Desai and whole-time director Dewang Neralla, a long-time close confidante of Jignesh Shah, the chairman and group CEO of FTIL. The committee has set a time-limit of 120 days to execute the restructuring plan.
Further, the restructuring plan will also include exploring the possibility of identifying a strategic partner who could help FTIL foray into domain beyond the financial market. Reports in the recent past have suggested that companies like Tech Mahindra and L&T have evinced interest in buying a stake in FTIL.
The committee will soon appoint an investment bank ďto conduct an open and transparent bidding process for the divestments as well as identifying strategic partners into FTIL.Ē Meanwhile, Anil Singhvi, founder and CEO of Ican Advisors has been appointed as corporate financial adviser to FTIL.
Ever since the NSEL crisis emerged in late July last year, the Jignesh Shah-promoted entity has been in the centre of controversy with agencies, including the Economic Offences Wing of the Mumbai Police, the Securities and Exchange Board of India (Sebi), the Income Tax and Enforcement Directorate (ED) looking at various aspects of the alleged role played