MCX-SX board meet: Co says business as usual, but is it?

MCX-SX, MCX commodity exchange and the NSEL have been promoted by Jignesh Shah’s Financial Technologies and all three exchanges are under intense regulatory scrutiny after the Rs 5,600-crore payments scam came to the fore at NSEL.

Today, at a hurriedly-conducted press conference, newly-appointed MCX-SX CEO and MD Saurabh Sarkar faced a lashing-out from journalists where he said that contrary, to media reports, there was no “emergency” board meeting being conducted as was reported by a section of the media and that the meeting had been planned a month in advance.

The CEO was heckled by anguished journalists for holding a “short” press conference where he declined to comment on any of the developments that are being rumoured to be taking place.

The exchange also put out a release stating that “it would be speculative to pre-empt resignation of all public interest directors and we would request to refrain from rumors and await the announcement post the board meeting. As in the case of other companies, new members would be nominated by shareholders or independent directors would be appointed by the regulator if the need arises.”

The board meeting would be held at 2 pm on Friday.

MCX-SX had late last year appointed former top bureaucrat Gopal Krishna Pillai as chairman, former LIC chairman Thomas Matthew, Prof Ashima Goyal and industry executive DR Dogra as public interest directors after the regulator renewed its licence with a suggestion that the exchange strengthen its corporate governance structure.

But sources close to the board members at MCX-SX -- which is battling decreasing volumes in the face of the NSEL crisis, apart from facing intense regulatory and media scrutiny -- told PTI that they have tried their best to revive the exchange in the last four-five months, but the things would get difficult going forward given ongoing developments.

MCX-SX has come up with a rights issue that is intended to reduce its related firms’ stakes.

Financial Technologies and MCX hold 5 percent each in the stock exchange while their total stake has to be brought down to 5 percent in all, as per Sebi guidelines.

The two firms also hold warrants, that, if converted, would increase the stake to 51 percent.

“The rights issue is on track and we have received a confirmation from several shareholders for participation. The outcome of the rights issue will be made public upon its completion by end of this month,” the exchange said in the statement.

“Meanwhile, we have also received expression of interest from new investors and the exchange could exercise a preferential allotment post the rights issue if it is not entirely subscribed.”