NYSE plans local entry, to acquire 5 percent stake in MCX

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Mumbai: Following the government's decision to formalize the foreign ownership structure in commodity exchanges, the world's biggest bourse New York Stock Exchange (NYSE) will pick up five percent stake in Multi Commodity Exchange (MCX) - India's largest commodity exchange. The proposed transaction is expected to be announced this week, reports The Economic Times. The new policy says total foreign holding in a comex can be 49 percent, with a cap of 23 percent for overseas portfolio investors and 26 percent for foreign direct investment (FDI). U.S. fund Fidelity had picked up nine percent in the exchange. Some of the other leading investors in Indian commodity exchanges are Goldman Sachs and Inter-Continental Exchange (ICE) Atlanta which bought equity in NCDEX - the other Mumbai based commodity exchange. The size of the deal with NYSE is not known. But a recent transaction in MCX, which is promoted by Mumbai-based Financial Technologies (FTIL), had put the valuation of the exchange at around $1 billion MCX is also preparing to hit the primary market with an initial public offering (IPO) shortly. Sources said MCX would sell 10 percent stake to raise around Rs 500-600 crore. According to sources, fresh shares will contribute the majority of the offering while the offer for sale will account for two to three percent. The issue is being managed by DSP Merrill Lynch, Kotak Securities and Enam Financial.