CSE plans to offer stake to 4 banks
Allahabad Bank, Uco Bank, United Bank of India and State Bank of India shortlisted
| CSE has submitted the revised demutualisation scheme to Sebi in April 2005. | |
| Under the law, brokers cannot hold more than 49 per cent stake in the exchanges in order to separate ownership from trading rights. | |
| All existing stock exchanges in India except NSE is owned by brokers. | |
| The three banks have been chosen because they were based in Kolkata. | |
| Some leading CSE members, who were also NSE brokers, told Business Standard they felt offering equity to the four banks was the only way to revive CSE as the banks could open up the debt segment in the exchange, which did not exist now. | |
| Sources in CSE said that offloading majority stake to the local banks had been viewed as the most viable proposal for the exchange, now going through its worst phase. | |
| Turnover had dwindled to Rs 15-16 crore per day. | |
| CSE administrator Tushar Kanti Das, when contacted, told Business Standard that offering stake to banks was one of the best alternatives. | |
| "Divesting 51 per cent stake is on the agenda under the Sebi guidelines. CSE might have to think about offering stake to the banks," he said. | |
| However, he did not elaborate on the roadmap, saying it would depends on Sebi. "Let Sebi approve the revised roadmap. We shall have one year time after Sebi approves the proposal," he said. | |
| However, sources said that the valuation of the exchange was around Rs 75 crore, according to a study conducted in 2002. | |
| "This means that for the 51 per cent stake, the banks have to pay around Rs 40 crore only. The amount is nothing considering the assets owned by CSE," said sources. | |
| According to them, CSE currently had a paid up equity of 1170 shares of Rs 250 per share. | |
| "The current value of the shares would be around Rs 6.5 lakh, but if required then CSE could offer additional preference shares for the purpose," added sources. | |
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