BSE divests 51 percent stake to investors

By siliconindia   |   Friday, 13 April 2007, 07:00 Hrs
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MUMBAI: Asia's oldest stock market, Bombay Stock Exchange Ltd. sold 51 percent of its stake to investors, led by Deutsche Boerse AG and Singapore Exchange Ltd. The sale happened with the BSE being valued at 40.6 billion ($950 million), a daily reported today. BSE�s Chief Executive Officer Rajnikant Patel informed that the exchange sold 16 percent to overseas investors and 25 percent to buyers in India. In addition, it completed the sale of 5 percent each to the Singapore and Frankfurt-based stock markets. Patel declined to name the other investors before regulators approved the sale. India�s benchmark Sensitive Index quadrupled in the past four years as the economy expanded at an annual clip of at least 8 percent. The National Stock Exchange of India Ltd. in January agreed to sell a 20 percent stake to investors led by NYSE Group Inc. and Goldman Sachs Group Inc., noted the paper. Deutsche Boerse, the world�s biggest stock exchange by market value and Singapore Exchange acquired 432,291 shares at Rs5,200 apiece. Brokers on 12 April approved the sale of new stock to the two exchanges. The exchange is cutting its brokers� stakes to 49 percent from 100 percent as part regulations by Securities & Exchange Board of India (SEBI) to separate ownership from trading. T.V. Raghunath, executive director of investment banking at Kotak Mahindra Capital Co., which is advising BSE on the sale told Mint that foreign and domestic investors including banks, insurance companies, high net worth individuals, mutual funds and private equity groups were keen to invest. Bombay Stock Exchange, which operates the nation�s benchmark 30-share Sensitive Index, is seeking partners as it raises funds to upgrade its systems and catch up with the National Stock Exchange, its younger rival. The National Stock Exchange, founded in 1992, has double the daily trading value of its 132-year-old counterpart.

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