NSE looking at diluting stake in NCDEX by tomorrow
The National Stock Exchange (NSE) on Wednesday said it is looking at meeting tomorrow's deadline for diluting stake in agri-commodity bourse NCDEX to 5% in compliance with commodity markets regulator FMC's new norms.business Updated: Mar 30, 2011 19:40 IST
The National Stock Exchange (NSE) on Wednesday said it is looking at meeting tomorrow's deadline for diluting stake in agri-commodity bourse NCDEX to 5% in compliance with commodity markets regulator FMC's new norms.
NSE needs to dilute its stake to 5% from its present 11.1 per by March 31. FMC on Wednesday said it will not give further extension to meet the norm and pointed out that the stock exchange will lose its voting right on the extra stake as per the Company Law.
Under the new guidelines for commodity exchanges, which have completed the five-year term, a stock exchange cannot hold more than five per cent stake in a commodity bourse.
"We will get to know about the NSE status tomorrow. I cannot give more time to NSE. It is not in my hands. I have the discretion of giving extension of three months and that I have already given," FMC Chairman B C Khatua said when asked whether FMC would give more time to NSE to bring down its stake.
When contacted, a NSE official told PTI: "We are trying to comply. We are in talks to try and comply within the deadline."
NSE said that it has not yet approached FMC for extension and hoped that dilution of stake could take place by tomorrow.
Khatua said that NCDEX has complied with all other norms except the reduction of the stake by NSE.
Recently, NCDEX roped in Jaypee Capital Services Ltd and Shree Renuka Sugars Ltd to enhance its net worth to Rs 50 crore as required under the new norm.
Jaypee Capital holds 22.38% stake in NCDEX, while Shree Renuka Sugars has 12.50% stake in the country's second largest commodity bourse.
LIC, IFFCO and NABARD are among other major shareholders in the exchange.
When asked whether NMCE and MCX have complied with the new norms, Khatua said, "We have given six months time to both exchanges to raise their net worth."