MCX to cut DGCX stake

Written by Dhimant Bhatt | Mumbai, Feb 26 | Updated: Feb 27 2008, 06:14am hrs
The multi-commodity exchange (MCX) decided to dilute its stake by 50% to 5% from the current 10% in the Dubai gold and commodities exchange (DGCX), a demutualised, fully electronic commodities and currencies exchange in Dubai.

As on December 31, 2007, Dubai Multi and Commodities Centre (DMCC) held 51% stake in the DGCX while Financial Technologies India Ltd (FTIL) held 19%, MCX and FT Group Investments Private Ltd (Mauritius) held 10% and 20%, respectively.

According to the draft red herring prospectus (DRHP) filed with the Securities and Exchange Board of India (Sebi) last week, MCX said, The exchange has entered into agreements to sell 5% of its holding in its joint venture entity, DGCX, to three investors during the period ended December 31, 2007. Pursuant to the agreements to sell, the company received an aggregate advance consideration of Rs 123.44 crore in full towards sale of investments.

Subsequent to December 31, 2007, the company has sold off 2% stake to one of the investors and in respect of the balance 3%, is in the process of completing the sale by transfer of shares in DGCX to the remaining two investors. On completion of the sale, the company would hold 5% in DGCX, said in a document.

MCX has entered into an agreement with New Vernon Private Equity Limited to sell 100 shares of DGCX. Further, the exchange has also entered into an agreement with Alexandra Global Master Fund and Passport India Investment (Mauritius) Limited to sell 200 shares each to both these investors. As on the date of filing this DRHP, these transfers have not taken place, as the aforesaid transferees are yet to submit their requisite documents to DMCC. DMCC has granted their consent to transfer these shares, said in a document.