NSE hits 26-per cent FDI cap after Morgan Stanley, Citigroup, Actis pick up 6 per cent stake
09 Mar 2007
Mumbai: Foreign direct investment in the National Stock Exchange (NSE) reached the 26-per cent ceiling after Morgan Stanley, Citigroup Inc and private equity firm Actis agreed to pick up a total six per cent stake in the bourse.
NSE, the country's largest exchange by trade volume, however, did not disclose the value of the transaction.
Morgan Stanley will acquire a three-per cent stake in NSE and Citigroup will pick up two per cent while Actis will buy one per cent. The stakes are being sold by from eight investors, the NSE said in a statement.
A clutch of institutional investors, including Industrial Development Bank of India, State Bank of India, SBI Capital Markets Ltd., Corporation Bank, Union Bank of India, Bank of Baroda, Canara Bank and Oriental Bank of Commerce, are selling stakes in the NSE.
IDBI is selling a two per cent stake while SBI is offloading a 1.5 per cent stake. The others are selling less than one per cent stakes.
The NYSE group, General Atlantic, Goldman Sachs and Softbank Asian Infrastructure Fund had in January signed agreements with a group of investors to pick up a total 20 per cent stake in the NSE.
While the government has capped foreign direct investment in bourses at 26 per cent, investment rules also limit single investor holding in bourses at five per cent.
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