IEX considering 15% stake in ICEX for Rs 150 crore: Report
The biggest hurdle for this deal would be getting SEBI's approval.
April 28, 2020 / 03:01 PM IST
The Indian Energy Exchange (IEX) is reportedly considering a 15 percent stake, worth Rs 150 crore, in Reliance ADAG’s Indian Commodity Exchange (ICEX).
ICEX is likely to offer new shares for the deal and shareholders, including Reliance Exchangenext, IndiaBulls Housing Finance, Indian Potash and MMTC, will see their shareholding percentage reduce, sources told Business Standard.
Moneycontrol could not independently verify the report.
ICEX offers futures in commodities such as basmati paddy, rubber and diamonds, while IEX is an electronic power trading platform regulated by the Central Electricity Regulatory Commission (CERC).
Sources said talks were in “advanced stage” but regulatory hurdles would take time to sort out. Since IEX is not yet classified as a stock exchange, legally it can initially buy only 5 percent stake in another exchange, the newspaper reported.
The biggest hurdle would be the approval from the Securities and Exchange Board of India (SEBI), it added.
Teams from IEX and ICEX had met SEBI officials and the regulator had “assured they will consider the issue”, sources said
An ICEX spokesperson refused to comment as per the report, while an IEX spokesperson said business dealings would be apprised of via the stock exchanges.
The deal had been long in the works as ICEX planned to build a net worth of at least Rs 100 crore minimum,sources said. It was looking to enter the electricity futures segment. If the deal comes through, another Rs 50 crore would be invested for market development and new product launches.