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Deutsche Borse picks up 5 p.c. stake in BSE

Special Correspondent

MUMBAI: Leading European exchange operator and transaction services provider, Deutsche Borse, on Wednesday signed a definitive agreement with the Bombay Stock Exchange (BSE) to invest in a 5 per cent stake for Rs. 189 crore at a price of Rs. 5,200 per share, and to explore ways of strengthening their collective. The transaction puts the value of BSE of Rs. 3,777 crore [$854 million].

The issue of shares is subject to relevant regulatory and shareholder approvals. Kotak Investment Banking advised BSE on the transaction.

"The alliance is of long-term strategic importance designed to achieve several objectives in multiple asset classes in which we found Deutsche Borse to be strong, BSE Managing Director and CEO, Rajnikant Patel, said.

"We see the exchange business becoming increasingly global," Deutsche Borse CEO, Reto Francioni, said.

Demutualisation

PTI reports

The BSE has been mandated to demutualise by May 17, meaning 51 per cent of its 100 per cent stake now held by 735 brokers has to be offloaded in a bid to corporatise it. With just little over 90 days left to complete the entire process, Mr. Patel said that the remaining 46 per cent was expected to be offloaded to strategic investors, financial institutions and private equity players.

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