MCX, FTIL rally on stake sale buzz

Written by fe Bureau | Mumbai | Updated: Jan 1 2014, 23:42pm hrs
Shares of Multi Commodity Exchange (MCX) and Financial Technologies (India) (FTIL) gained smartly in the intra-day trades on Tuesday on buzz that Mumbai-based Universal Commodity Exchange (UCX) is interested in buying a stake in the commodity futures exchange promoted by Jignesh Shah.

While it could not be independently ascertained if a formal proposal for a stake purchase has been submitted by UCX to the Forward Markets Commission (FMC), the buzz was enough to push the stock price of MCX and FTIL by 4% and 5.50%, respectively. Any stake purchase in a commodity futures exchange has to be cleared by the FMC.

According to market buzz, UCX along with a clutch of foreign institutional investors (FIIs) is interested in buying a stake in MCX, which is the countrys largest commodity futures bourse and also the most profitable. On BSE, shares of MCX closed at R478.80, up 0.87% while FTIL gained 1.64% to close at R185.40.

According to the website, the strategic partners of UCX include IDBI Bank, Indian Farmers Fertiliser Cooperative (Iffco), Nabard and REC. The buzz comes close on the heels of the board of MCX advising Shah-controlled FTIL to reduce its stake in the bourse from the current 26% to 2% within a month. The board suggestion came after the FMC declared FTIL as unfit to act as an anchor shareholder in any exchange. FTIL was declared not fit-&-proper in the wake of the settlement crisis at the National Spot Exchange (NSEL), which is promoted by FTIL.