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Last Updated : May 09, 2017 02:37 PM IST | Source: Moneycontrol.com

RBI transfers divestment case in MCX to Enforcement Directorate

Alexandra, one of the institutional investors in MCX, did not have the approval of the Foreign Investment Promotion Board (FIPB) to divest its stake in MCX, sources said.

 
 
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The Reserve Bank of India has transferred the case relating to the divestment by foreign portfolio investor Alexandra Mauritius in Multi Commodity Exchange (MCX), to the Enforcement Directorate (ED), sources told Moneycontrol.

Alexandra, one of the institutional investors in MCX, did not have the approval of the Foreign Investment Promotion Board (FIPB) to divest its stake in MCX, sources said.

Alexandra had partially divested its stake during MCX’s initial public offering in early 2012. The fund house has been untraceable for a while now. Last year, 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.

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“RBI has sent case to ED for further investigation since Alexandra Mauritius is not traceable and did not get FIPB approval even after five years of disinvestment from the company,”  the source told Moneycontrol.

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, MCX had approached the RBI before its initial public offer in 2012 seeking 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 gets underway. RBI is believed to have made an exception to the rule that mandates that all foreign companies should ideally have FIPB nod before an IPO is launched.

In 2013, FIPB shot down Alexandra Mauritius’s divestment in MCX after a search couldn’t trace the beneficiary of AML.

Following the CBI case against AML, the investigative agency had asked SEBI to follow up with company’s divestment details. The markets regulator then sought RBI’s intervention, which has finally transferred the case to ED.

Alexandra currently holds no stake in the bourse having sold its entire holding in the secondary market. “[the company] sold its residual stake in 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. One in MCX and other in Su-raj Diamonds. CBI and ED are investigating Su-raj Diamonds for diversion of bank loans.

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First Published on May 9, 2017 01:30 pm
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