Worldsec To Pick 75% In Prime Broking

Worldsec Ltd of Hong Kong is picking up 75 per cent of the enhanced equity of Prime Broking Company India Ltd at a cost of $5 million.

To this end, the Foreign Investment Promotion Board (FIPB) has cleared a proposal by Prime Broking to issue 1,60,23,000 equity shares to Worldsec on a repatriation basis. The remaining 25 per cent of the equity will be held by residents. The company will carry out the business of share and stock broking, debt broking, research and debt placements. The infusion of capital by Worldsec will be used by Prime Broking to expand its business opportunities.

 

According to Prime Broking, the proposed investment by Worldsec will provide it with much-needed capital to enable it to operate competitively.

The investment will help Prime Broking in getting access to information on the latest developments in the financial markets world-wide and would also help its practices with those followed in international markets.

Worldsec will also provide the company with much-needed support in building a high-quality, professional cadre of financial services personnel.

The proposal before the FIPB was accompanied by the necessary board resolution. Prime Broking Co India Ltd, a wholly-owned subsidiary of Prime Securities Ltd, is an unlisted company engaged in institutional and corporate stock broking, debt broking securities placements and equity research.

The parent company is into corporate advisory services in the areas of mergers and acquisitions, equity and debt origination and investment banking.

Worldsec is a financial services group affiliated to Bank of Tokyo Mitsubishi. It focuses on providing independent value-added services to its clients in relation to Asian equity and related services. It also provides research-driven advisory stock broking services to institutional, corporate and retail investors wishing to participate in the securities markets of Asia.

The Hong Kong group is also engaged in futures and option trading and providing nominee services, apart from corporate financial services to Asia-based corporate clients. The group's commission income and corporate finance income for the year 1997 was about $23.7 million. Its client base is predominantly internationally oriented institutional and fund management companies located in Europe, the United States and Asia. The administrative ministry, the department of economic affairs, had supported the proposal.