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Blackstone-backed FTIL appoints committee to sell 24% in MCX, find strategic partner

28 February, 2014

Financial Technologies India Ltd (FTIL) has appointed a committee to see through a restructuring process which includes sale of 24 per cent stake in MCX as also divestment of other assets besides roping in a strategic investor in the company, as per a stock market disclosure. Its stake in MCX is currently valued over $100 million.

The four-member committee comprises two independent directors on its board—Venkat Chary and S Rajendran— besides legal adviser Berjis Desai and Dewang Neralla, a whole-time board member, to propose and oversee the company’s restructuring plan.

The four-member panel has been given up to four months to come up with a concrete plan that includes selling up to 24 per cent stake in Multi Commodity Exchange of India (MCX), as ordered by the Forwards Market Commission (FMC), and identifying a strategic partner for FTIL, the statement said.

The committee is also expected to consider divestment of FTIL’s investment in its other ventures.

It will appoint an investment bank to conduct a bidding process for stake divestments and rope in a strategic partner, as part of the restructuring plan.

The development follows an order by FMC in December that declared FTIL and its promoter Shah unfit to operate an exchange in the country, in light of the National Spot Exchange Ltd (NSEL) scam. FMC also directed FTIL—which owns 26 per cent stake in MCX— and Shah to bring down their stake in the exchange to 2 per cent. Following this, MCX board had also asked its promoter FTIL, which in turn is backed by private equity firm Blackstone, to cut its stake in line with the FMC order.

FTIL has also roped in Anil Singhvi, founder and CEO of Ican Advisors and former MD of Ambuja Cements, as its corporate financial advisor to help resolve the Rs 5,574 crore payments crisis at the group company NSEL, in which FTIL owns 99.9 per cent stake.

Meanwhile, FTIL said in a separate filing to the bourses that the company has not signed any definitive agreement to sell stake in its warehousing arm National Bulk Handling Corporation (NBHC) to private equity firm India Value Fund Advisors (IVFA). The clarification was in response to a report in The Economic Times citing sources that FTIL had sold NBHC to IVFA for Rs 300 crore.

(Edited by Joby Puthuparampil Johnson)


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Blackstone-backed FTIL appoints committee to sell 24% in MCX, find strategic partner

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