|
| CDSL to stay independent, says BSE |
| Mehul Shah / Mumbai Jun 23, 2010, 02:55 IST |
|
The Bombay Stock Exchange (BSE) said it’d keep Central Depository Services Ltd (CDSL) as an independent entity even after acquiring a controlling stake, addressing worries that the latter would lose its freedom.
“The objective (behind increasing stake in CDSL) was to enhance business synergies between the two organisations and CDSL will continue to act as an independent entity,” a BSE spokesperson said in response to a query from Business Standard.
CDSL had been opposing BSE’s plan to acquire controlling stake in it. BSE had, in February, requested CDSL to issue preferential shares to the exchange to increase its holding in the depository above 51 per cent. CDSL rejected the proposal, as it wanted to remain independent, fearing loss of business from members of other stock exchanges.
However, BSE, Asia’s oldest stock exchange, managed to raise its holding in CDSL to 50.2 per cent by purchasing 7.18 per cent from HDFC Bank and 4.5 per cent from Bank of Baroda, the BSE spokesperson said.
The agreement to purchase about 4 per cent stake in CDSL from Bank of India (BoI) is yet to be consummated, she added. After the stake purchase, BSE’s holding in CDSL would go up to 54.2 per cent. BSE had bought stakes in CDSL at Rs 50 per share, the spokesperson added. This values the depository at Rs 522 crore. Before the latest stake purchase, BSE had 38.5 per cent holding in CDSL. HDFC Bank had 14.36 per cent stake in the depository, while Bank of India and Bank of Baroda held 9.57 per cent each.
State Bank of India (9.57 per cent), Standard Chartered Bank (7.18 per cent) and Canara Bank (6.45 per cent) are the other major shareholders of CDSL. BSE’s latest move came after its bigger rival, National Stock Exchange (NSE), increased its holding in National Securities Depository Ltd (NSDL) to 25.05 per cent by purchasing 9.42 per cent from Special Undertaking of the Unit Trust of India (SUUTI) in March this year.
Ahead of an imminent entry of the MCX Stock Exchange (MCX-SX) into equity and the equity derivatives trading business, the battle between BSE and NSE has intensified, with both wooing brokers by reducing charges and launching new products.
|
|
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
|
Content Guide
