Warburg Pincus, Tata Capital join bourses for FTIL's stake in MCX

As Financial Technologies India Limited (FTIL) is selling its stake in the Multi Commodity Exchange (MCX), it is reliably learnt that Warburg Pincus, a leading private equity firm, and Tata Capital have also shown interest in picking up stake. The Bombay Stock Exchange and Deutsche Borse are also keen to pick up stake. Among private players, Kotak Group has also shown interest. However, as per existing norms, the players cannot take more than five per cent stake each in MCX. All of then declined to comment on the matter.

Meanwhile, MCX has once again asked FTIL to transfer its shares in the exchange to an escrow account, even as the latter has initiated the process of divesting from the bourse in a transparent manner.

Last week, FTIL informed the regulator and MCX that J M Finance, an investment advisor appointed by it for the purpose, had already received offers from 10 reputed national and international players. The company has also said the process of divesting stake would be completed in six-seven weeks.

However, in response, MCX asked FTIL to transfer its shares to the escrow account with a mutually agreeable company as trustee to show their commitment. In case of shares not getting sold in committed time, the MCX would have the right to sell the shares through auction and remit the proceeds to the FTIL. An FTIL spokesperson said, “The process of stake sale is at an advanced stage and now those who have expressed their intentions will be asked to submit non-binding offers before taking a final decision and process will be over in weeks.” However, an insider in the company said the MCX demand was not legally tenable.

The issue of stake sale by FTIL arose after the commodity regulator said the former was not “fit and proper” to run MCX and hence should cut its stake in the exchange from 26 per cent to bring it below two per cent.

In yet another development, on Wednesday, existing shareholders of MCX who own over one per cent equity met at the exchange’s office to chalk out their strategy at a time the regulator wants FTIL to offload its stake.

These shareholders plan to write to various regulatory agencies to protect their interests, while taking action on the anchor investor. They have also discussed that MCX’s plan to issue preferential shares will not augur well for them, as it will reduce earning per share for them.