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ICICI Ventures is close to buy a 5% equity stake in Multi Commodity Exchange of India (MCX). According to sources, negotiations with ICICI Ventures and a couple of other investors have been going on for the past couple of months. Earlier this year when Financial Technologies (FT), the promoter of MCX, divest its stake to Citi and Merrill Lynch the exchange was valued at slightly over $1 bn.
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The stake sale to ICICI Ventures is also likely to be around the same valuation. ICICI Ventures likely to acquire the stake from Financial Technologies. The other major stakeholders of the exchange are HDFC Bank, SBI and other public sector banks holding a total 27%, FID Fund (Mauritus) an affiliate of Fidelity International has a 9% stake, both Citi and Merrill Lynch have a 5% stake each, Passport India Investment (Mauritius) has 3% stake while GLG Financials Fund has another 2% stake.
The new norms to admit foreign investment in commodity exchanges are just waiting in the wings. Sections think these norms likely to be on the similar lines of the foreign investment rules in stock exchanges, stipulated at 49%. Further, Sebi has stipulated the investment limit for a single foreign investor at 5%, beyond which an FII or any other investor, like foreign stock exchanges, cannot raise its stake in domestic exchanges.
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