Bombay Stock Exchange buys stake in commodity exchange
Tuesday, 26 February 2008, 13:42 Hrs
Mumbai: The Bombay Stock Exchange (BSE) has picked up 26 percent stake in Ahmedabad-based National Multi-Commodity Exchange of India Ltd (NMCE) for about 1 billion ($25 million). Kailash Gupta, managing director of NMCE, said BSE would pay about 1 billion for the newly issued shares in the exchange. The fresh equity would lower the stake owned by Neptune Overseas Ltd, who now manage the exchange, from 25 percent currently to 18 to 19 percent, Gupta said. NMCE will now be the second commodity exchange in the country with a stock exchange as promoter. The National Stock Exchange of India has a 1 percent interest in National Commodity and Derivatives Exchange Limited (NCDEX). The agreement to formalise the deal was signed Monday in Mumbai by Rajnikant Patel, managing director and CEO of BSE and Kailash Gupta, managing director of NMCE. NMCE is India's third-largest online commodity exchange. The most actively traded commodities on the exchange are pepper, cardamom and rubber. Patel said: "BSE's foray into the commodities market space will bring 133 years of expertise, global brand value, technology, best corporate governance practices and nation-wide reach. It denotes BSE's expanding horizon in the financial market space."