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BSE expects to complete United Stock Exchange deal in 9 months


BSENew Delhi: Leading bourse BSE expects to complete the acquisition of United Stock Exchange in the next 8-9 months, a time period during which regulatory as well as shareholders’ approvals are likely to be in place.

The share-swap deal, which has been approved by boards of both exchanges, would bring in more synergies for BSE.

“We are in the process of getting approvals from the regulators and the High Court (for the deal)… It takes around 8 to 9 months for all this process to get over,” BSE Chairman and Managing Director Ashishkumar Chauhan told.

Besides, the deal has to be approved by the shareholders of the two bourses.

As per the agreed deal, for every 385 shares held in USE a shareholder would get one share of BSE.

The loss-making United Stock Exchange (USE) is trading only in currency futures.

BSE is already a strategic partner in the exchange and was the single largest shareholder with nearly 15 per cent at the end of December 2013.

For the year-ended March 2014, USE posted a net loss of Rs 3.93 crore whereas it had a net profit of Rs 46.36 lakh in the year-ago period.

The exchange’s net loss stood at Rs 2.47 crore in the three months ended March. In the same period a year ago, it had a net profit of Rs 56.41 lakh.

Going by reports, USE’s net worth stood at around Rs 118 crore at the end of December last. Under Sebi regulations, an exchange should have minimum net worth of Rs 100 crore.

BSE, Asia’s oldest bourse, late last year had launched trading in currency derivatives.

Apart from BSE, private sector lender Federal Bank is another major shareholder with about six per cent stake in USE at the end of December quarter. Other stakeholders, at that time, included Standard Chartered Bank (Mauritius) Ltd, HDFC Bank, State Bank of India, MMTC and Jaypee Capital Services. PTI

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