Sebi clears MCX IPO proposal

Leading commodity exchange MCX today said market regulator Sebi has cleared its Draft Red Herring Prospectus for an initial public offer.

The clearance of the Securities and Exchange Board of India (Sebi) is valid for 12 months from now. The exchange has been asked to file offer document with stock exchange/ROC, a company spokesperson said here.

The Multi-Commodity Exchange of India (MCX) had filed DRHP with Sebi for an IPO of 6,427,378 equity shares of Rs 10 each through an offer for sale by existing shareholders.

The offer constitutes 12.60% of the paid-up equity share capital of the company.

The offer will be through a 100% book-building process, wherein not more than 50% of the net offer will be allocated on a proportionate basis to qualified institutional buyers, not less than 15% of the issue will be available to non-institutional bidders and not less than 35% of the issue will be available to retail individual bidders.

The exchange has diverse shareholding pattern with international names like NYSE Euronext, Fidelity, Merrill and leading Govt institutions like SBI, Nabard, Corporation Bank.

Financial Technologies (India) Ltd, State Bank of India, GLG Financials Fund, Alexandra Mauritius, Corporation Bank, ICICI Lombard General Insurance Company and Bank of Baroda are the selling shareholders in the offer. FTIL (Promotors of MCX) holds 31% before IPO and will dilute to 26%.

Listing is expected to ensure the highest level of shareholder and public scrutiny, corporate governance and transparent trade practices, the official said.

The exchange paid dividend over 3.15 times that of equity since its inception.

MCX is the sixth largest commodity exchange in the world with No 1 in silver and No 2 ranking in gold. It would be the first exchange in India to go public and get India at par with other countries with listed exchanges such as the US, Hong Kong, the UK, Singapore, Japan and Australia.

Edelweiss Capital, Citigroup Global Markets India and Morgan Stanley India Company are the book running lead managers to the offer.