Financial Technologies-promoted MCX to exit 3 exchange ventures

Written by fe Bureau | Mumbai | Updated: Feb 21 2014, 20:48pm hrs
Stock ExchangeJignesh Shah-promoted MCX is looking to divest its residual 3.5% stake in DGCX, 5% in MCX-SX and 26% in MCX-SX Clearing Corp.
Multi Commodity Exchange of India Ltd (MCX), which is promoted by Financial Technologies India Ltd (FTIL), intends to sell its holding in entities like Dubai Gold & Commodities Exchange (DGCX), MCX Stock Exchange (MCX-SX) and MCX-SX Clearing Corporation.

MCX intends to divest its shareholding in a few ventures... the organisation needs investment/merchant bankers to strategically advise on the sale of these shares, said an advertisement issued by the commodity futures bourse.

According to people familiar with the development, the Jignesh Shah-promoted bourse is looking to divest its residual 3.5% stake in DGCX, along with its 5% stake in MCX-SX and 26% stake in MCX-SX Clearing Corporation. The exchange is looking for investment bankers with a minimum net worth of Rs 50 crore along with a successful track record in exchange transactions by way of private deals.

Interestingly, the announcement comes in the midst of talks of a settlement between FTIL and investors of the National Spot Exchange (NSEL). It could, however, not be independently verified if the sale proceeds from MCX where FTIL is the anchor investor with a 26% stakeholding, could be used to repay the outstanding liability in the Rs 5,600 crore settlement crisis at NSEL, in which FTIL holds 99.99% stake.

Market players also say that the bourse is not expected to pocket a large amount with the proposed sale as all the entities are unlisted with MCX-SX failing to register significant volumes ever since its launch last year. According to Bloomberg, MCX has a total cash reserve of R388 crore as on September 30, 2013.

In the case of DGCX, both, FTIL and MCX, have been gradually reducing their stake due to regulatory reasons. FTIL, which once held 50% stake in the bourse, now holds 27.5% in the exchange with the majority owned by Dubai Multi Commodities Centre (DMCC), a strategic initiative of the Government of Dubai.

Shares of MCX lost marginal ground on Thursday to close at Rs 540.55.

Hemant Vastani, MCX CFO, resigns

Multi Commodity Exchange (MCX) on Thursday announced the resignation of its CFO Hemant Vastani. The resignation comes amid the continuing Rs 5,600- crore payment crisis at the FTIL-promoted National Spot Exchange (NSEL) MCX, in which FTIL holds a 26% stake, said in a BSE filing that the exchange has accepted the CFOs resignation. It did not specify a reason for his resignation.

In October, Jignesh Shah had resigned as Non-Executive vice chairman of MCX after sectoral regulator FMC issued notice to him and Financial Technologies India, questioning fit and proper status.