Tarun Sharma Moneycontrol News
The Enforcement Directorate is planning to register a case regarding the exit of a foreign investor, Alexandra Mauritius Ltd, from the Multi Commodity Exchange (MCX) without the approval of the FIPB, a source told Moneycontrol.
The RBI had registered a complaint in this regard with the ED in 2017.
A senior ED official told Moneycontrol, “We are studying the complaint as well as the CBI probe report and are likely to register a case in the next few days."
Alexandra, one of the institutional investors in MCX, has been untraceable and failed to get FIPB approval even six years after it sold its stake in the company.
Some RBI officials are also under the scanner since they had approved divestment on post facto conditions despite Foreign Investment Promotional Board (FIPB) approvals not being in place for the Mauritius fund. The ED will also probe if the fund was used as a conduit for round tripping.
The case had come into light when a Delhi-based fund manager filed a complaint with the CBI against MCX.
Alexandra had partially divested its stake during MCX’s initial public offering in early 2012. In 2016, CBI had initiated a probe into the case and sought details from SEBI. The regulator had, in turn, asked for details from the RBI and MCX. SEBI also wrote to MCX and RBI for non-compliance with requirements of FIPB approval.
In 2012, AML had divested 390,754 shares in the bourse through an offer for sale. This was half its holding of 781,508 shares bought in 2007 from MCX promoter (and now defunct) FTIL by paying Rs 45 crore, or Rs 577.50 apiece.
As per norms, the MCX had approached the RBI before its initial public offer in 2012, seeking the regulator’s approval for Alexandra’s divestment in the bourse. The RBI had approved it but had directed MCX to get FIPB approval after the listing. The RBI is believed to have made an exception to the rule that mandates all foreign institutional investors to have the FIPB’s approval before selling shares through an IPO.
In 2013, FIPB shot down Alexandra Mauritius’s divestment in MCX after they failed to track the beneficiary owner of AML.
Alexandra currently holds no stake in the bourse, having sold its entire holding in the secondary market. “[The company] sold its residual stake in the secondary market after listing of MCX. Promoters of MCX could have frozen Alexandra’s stake when FIPB approval was not in place [but had failed to so],” sources told Moneycontrol.
Alexandra Mauritius had investments in only two Indian companies — MCX and Su-raj Diamonds. The CBI and ED are investigating Su-raj Diamonds for diversion of bank loans.
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