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Omani fund plans to acquire stake in NCDEX

Oman Investment Fund (OIF) is in an advanced stage of discussion with Jaypee Capital Services for acquiring 9.7 per cent stake in India’s agricultural futures exchange — National Commodity and Derivative Exchange Limited (NCDEX), according to a newspaper report.

India’s Economic Times said that Delhi-based broker Jaypee Capital Services, the anchor investor in NCDEX, is in advanced talks with domestic and foreign private equity players to sell a chunk of its 22.4 per cent stake in the bourse. The shareholder, according to sources, is close to selling 14.7 per cent to IDFC Private Equity Fund and Oman Investment Fund for Rs1,320 million ( Rs180 a share). About five per cent will go to IDFC PE for Rs440 million while 9.7 per cent will be sold to OIF for Rs.880 million.

The two deals value NCDEX at Rs9,120 million, lower than rival MCX’s value of Rs1,4360 million. Motilal Oswal’s Investment Banking arm is Jaypee’s advisor.

Jaypee was issued shares at a hugely discounted price of Rs59 a share in 2010 compared to Rs145 a share that Renuka paid Crisil for a seven per cent stake before that. “The shares were issued to Jaypee at a discount as it agreed to ramp up volumes on the bourse over a three year period. The shareholder’s agreement also stated that if Jaypee failed to raise volumes, it would have to pay Rs57.33 a share to NCDEX,” said the newspaper quoting a source.

Emails and calls made to the media representatives of Oman Investment Fund did not elicit any response.

The average daily turnover of NCDEX is Rs 34,000 million against Rs300,000 million of metals and energy bourse MCX, whose turnover has halved because of the commodity transaction tax introduced in July and the problems with NSEL, whose promoter Financial Technologies, holds 26 per cent in MCX.

Source: Times of Oman

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