FMC approves Kotak Mahindra Bank deal to buy 15% stake in MCX
Commodity market regulator FMC has approved the Kotak Mahindra Bank's deal to acquire 15% stake in MCX for Rs 459 crore from Jignesh Shah-led FTIL.business Updated: Aug 27, 2014 17:37 IST
Commodity market regulator FMC has approved the Kotak Mahindra Bank's deal to acquire 15% stake in MCX for Rs 459 crore from Jignesh Shah-led FTIL.
Forward Markets Commission (FMC) has also asked Kotak Mahindra Bank Ltd to disclose every-year to commodity exchange MCX that it is in compliance with 'fit and proper' criteria.
"...I am directed to convey the approval of the commission for your proposed acquisition up to 15% of equity share capital of MCX," FMC economic officer said in a letter written to Kotak Mahindra Bank.
FMC asked the Kotak Manhindra Bank to comply with the requirement of filing a declaration within 15 days from the end of every financial year to MCX that the company complies with the 'fit and proper' criteria.
In July, Financial Technologies India Ltd (FTIL) had announced that it has signed an agreement to sell 15% stake in MCX to Kotak Mahindra Bank for Rs 459 crore.
FTIL originally held a 26% stake in MCX and it is divesting stake in MCX?after market regulator FMC had declared the company unfit to run any exchange in the wake of Rs 5,600 crore payment crisis at group company National Spot Exchange Ltd (NSEL).
The regulator had asked FTIL to reduce its stake in MCX to 2% from 26%.
Before the Kotak deal, FTIL had sold 6 per cent stake in MCX in two rounds for about Rs 220 crore, bringing down its shareholding to 20% .
After an agreement with Kotak Mahindra bank to sell 15% stake, FTIL is left with 5% stake in MCX.