Sebi allows Magadh Stock Exchange to exit bourse business

The Securities and Exchange Board of India (Sebi) Wednesday allowed Magadh Stock Exchange to exit the stock bourse business.

The regulator said that Magadh Stock Exchange (MSE) has substantially complied with the exit conditions laid down by it and therefore, it is a fit case to allow MSE to exit which will also enable the exchange to liquidate its assets post exit and to pay the outstanding dues.

"...it is observed that all the known liabilities have been brought out and that there is no future liability that is not known as on date," Sebi said in an exit order.

Besides, it is noted that MSE has no outstanding dues to Sebi pertaining to 10 per cent of the listing fee and the annual regulatory fee, the regulator said.

The regulator has asked the MSE to change its name and not to use the expression ''stock exchange'' or any variant of this expression in its name, among other things.

According to Sebi, MSE was recognised as a stock exchange for a period of five years commencing from December 1986 and it was last renewed for a year in December 2005.

In May 2012, Sebi issued guidelines laying down the framework for exit by stock exchanges whose recognition is withdrawn. The guidelines required stock exchanges, which are already de-recognised to make an application for exit within two months and upon failing to do so, such exchanges shall be subject to the compulsory exit process.

As no such application was received from MSE, therefore, the compulsory exit process was initiated, Sebi said.