Financial Daily from THE HINDU group of publications
Tuesday, May 09, 2006
Financial Daily from THE HINDU group of publications Tuesday, May 09, 2006 |
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Stock Exchanges Markets - Regulatory Bodies & Rulings Our Bureau
Mumbai , May 8 A SEBI panel on Monday came out with a series of recommendations on the future of regional stock exchanges (RSEs) and suggested that they may be allowed self-listing through an IPO or bring in strategic partners so that they could be a useful platform for small and medium enterprises to raise funds. The committee headed by the SEBI Whole-Time Member, Mr G. Anantharaman, also asked all the RSEs to collectively choose either a BSE model or in the alternative the ICSE (Inter-connected Stock Exchange) model in order to succeed. The report of the committee to study the future of RSEs post-demutualisation said "self-listing be permitted either through the IPO route or by way of listing with appropriate exemptions in case a stock exchange does not make a public offer." Overseas listing will also be permitted after the exchange gets itself listed on the domestic markets, the committee said.
Strategic investor
According to the panel, the RSE can bring in a strategic investor who will hold less than 15 per cent share capital and voting rights in the stock exchange. The strategic partner could hold up to a maximum of 26 per cent stake if it is a multilateral agency, an exchange, insurance company, bank, depository or a clearing corporation. To become eligible for self-listing, a stock exchange must ``demutualise'' itself and open up to ownership by outsiders other than its trading members, the committee said.
Can shut shop
The SEBI recommendations, which come in the wake of massive loss of business suffered by regional stock exchanges, said small exchanges that want to close down must be allowed to do so. However, they could do so only after delisting non-compliant firms.
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