FTIL to sell 15% MCX stake to Kotak Mahindra Bank for Rs459 crore
21 July 2014
Financial Technologies (India) Ltd (FTIL) will sell a 15-per cent stake in Multi Commodity Exchange (MCX) to Kotak Mahindra Bank for Rs459 crore, as part of a Sebi-mandated stake sale to bring down MCX's promoter stake to 2 per cent.
Jignesh Shah-led FTIL will have to sell its holdings in various stock exchanges and clearing houses, after the market regulator Forward Market Commission (FMC), declared the promoter not ''fit and proper'' to hold a stake in an exchange or clearing corporation in Decenber 2013 (See: Jignesh Shah, FTIL not fit and proper to run a bourse: FMC).
"Subject to certain conditions to be fulfilled, including regulatory approvals prior to closing of the transaction, FTIL has entered into a share purchase agreement (SPA) to sell 15% stake in MCX to Kotak Mahindra Bank for a total consideration of Rs 459 crore," FTIL said in a statement.
FTIL, which has to bring down its stake to 2 per cent in MCX following the FMC order and a subsequent order from SEBI (SEBI bars Financial Technologies from holding stake in MCX-SX, other bourses), had offloaded a 4-per cent stake in the commodity exchange on 16 July.
In its March order, Sebi had directed FTIL to sell its holdings in any stock exchange or clearing corporation within 90 days. The deadline has already expired and the Securities Appellate Tribunal (SAT) on Wednesday also dismissed the company's petition against the Sebi order.
The tribunal, however, extended the deadline for divestment of stake by FTIL by four weeks. In the meantime, FTIL can challenge Sebi's order in court.
In December, FMC had declared FTIL, the parent of MCX, as unfit to run any exchange after a Rs5,600-crore payment crisis at group company National Spot Exchange (NSEL).