MCX makes final effort to sell warrants in MSEI

Will invite bids on Thursday for the warrants it has in the MSEI at a reserve price of Rs 1.10 each

After rejection of extending time for selling warrants and also markets regulator Sebi rejecting the exchange’s proposal to increase stake in Metropolitan Stock Exchange of India, the Multi Commodities Exchange is making last ditch efforts to sell the warrants it holds in the stock exchange.

Multi Commodity Exchange (MCX) invited bids on Thursday for the warrants it has in the Metropolitan Stock Exchange of India (MSEI), at a reserve price of Rs 1.10 each.

The warrants are convertible into equity shares. The exchange has invited bids by June 16, to sell 400 million warrants.

It has been told by the Securities and Exchange Board of India to sell all the warrants by June 19, its earlier pleas for extension being rejected. This is a sequel to the problem that Financial Technologies (FTIL) had with the regulatory authorities; it and MCX had promoted the MCX Stock Exchange, now renamed MSEI.

According to sources in the know, the commodity exchange is in talks with some investors to sell some of the warrants, while inviting bids for the others.

Two days earlier, MSEI had launched a rights issue at Rs 1 a share. MCX hopes to get a higher price. A “10 per cent premium is justified,” said a person involved with the process.

MCX sold warrants a few months earlier to IL&FS at Rs 2.50 each. However, after MSEI’s rights issue at a lower price, the market appetite has come down.