Global private equity player TA Associates picks up 2% stake in NSE

Global private equity player TA Associates has picked up two per cent stake in the National Stock Exchange (NSE), the county’s biggest bourse. The US-headquartered firm is said to have paid $150 million (Rs 1,130 crore) for a little over two per cent stake. The stake was acquired in multiple tranches in recent weeks. The transaction values the exchange at about Rs 51,000 crore and Rs 53,000 crore.
 

Dhiraj Poddar, managing director, TA Associates confirmed the acquisition but refused to divulge the price or the identity of the sellers.

“I can confirm that we have picked the stake. Two or three aspects why we have done this. We have invested in other exchanges across the globe. People are channelizing more savings towards financial assets. This will drive more flows into equity and boost trading volumes over a period of time. We are long-term investors. We are backing the growth that we expect to see in trading volumes over many years,” he said.

NSE has recorded huge growth in volumes this year and also has consolidated its market share. For the first half of 2020, the exchange enjoyed 93 per cent market share in the cash segment and nearly 100 per cent share in the derivatives segment.

BSE, which listed in early-2017, has market cap of about Rs 2,300 crore. While NSE has been a more sought-after exchange for investors, uncertainty over its initial public offering (IPO) has discouraged many from investing in it. Many investors who were looking to dilute their holdings in the exchange’s proposed IPO are divesting through private transactions.

Earlier this year, Union Bank of India had sold 0.31 per cent stake in NSE for Rs 104 crore.

In December 2016, NSE had filed its offer document with market regulator Sebi. The listing plans were however stalled due to the probe against the exchange for allegedly giving unfair access to some brokers at its co-location facility.