MCX-SX extends rights issue deadline by a month

The Multi Commodities Exchange-Stock Exchange (MCX-SX) has announced it would extend the deadline for its rights issue by a month.

The additional time is to allow banks to get necessary clearances from their boards and the Reserve Bank of India (RBI), according to a statement issued by the exchange.

“...Some banks have indicated the proposal is in advanced stages of clearances from their boards and RBI and needed more time. Hence, the exchange has agreed to extend the period of rights issue by another month,” it said.

The exchange had announced it would be looking at a 2:1 rights issue, allowing investors to pick up two shares for every one that they already hold. It also said it had received feelers from new domestic and international investors and that it would consider a preferential issue to such investors after the rights issue.

The exchange will now keep the issue open till April 17.  The exchange is looking to raise Rs 544.7 crore through the exercise, offering shares to investors at Rs 5 a share.

Major investors in the exchange include Union Bank of India (11.47 per cent), IFCI (13.2 per cent) and IL&FS Financial Services at 9.18 per cent. HDFC Bank, Axis Bank and Bank of Baroda are also shareholders in the exchange.

Other shareholders include Financial Technologies (India) Limited (FTIL) and Multi Commodity Exchange of India (MCX). The two hold 4.99 per cent stake each in the MCX-SX along with some warrants, which adds up to about 70 per cent stake in the exchange. They were re-classified from promoter to public shareholder, earlier in the month.

The Securities and Exchange Board of India (Sebi) asked FTIL to sell its stake in the company in an order on March 19, saying it no longer met the “fit and proper” norm to hold stake in an exchange. The move followed a similar order by the commodity regulator, which had passed a similar observation on account of the Rs 5,600-crore payment crisis in the National Spot Exchange Limited (NSEL). FTIL has a 99 per cent stake in NSEL.