The Hindu Business Line : CSE demutualisation: stake offer oversubscribed

City-based companies, both listed and unlisted, have technically “over-subscribed” to fresh issue of shares by the SEBI-administered Calcutta Stock Exchange, currently undergoing a de-mutualisation process.

Some 22 companies responded to the offer. Of these, 12 have sought to pick up 5 per cent (the ceiling) each, while 10 more applied for less than 5 per cent stake in the regional stock exchange. The BSE, which has already been de-mutualised, had earlier proposed to pick up 5 per cent stake in CSE. The BSE also signed an MoU for sharing of trading platform with CSE. This is to be formalised by the 9-member board of the CSE, after its installation some time next month.

Six-member Empowered Committee on Friday placed before the market regulator the final list of intending stakeholders and the respective commitment for a total of little over 3 lakh shares on offer.

The Re 1 face-valued has been priced at Rs 2,000 each. The fresh shares would represent 51 per cent stake in the proposed de-mutualised entity. The basis of allotment would also be determined by the market regulator, which super-ceded the board of the 100 per cent broker-owned corporate entity, The Calcutta Stock Exchange Association Ltd.

After clearance by SEBI, firm allotment would be made by the exchange administration on August 29. The existing entity had 3 lakh shares issued and subscribed by the member brokers. The issue proceeds, including premium of Rs 1,999 per share would be utilised to fund revamp of the exchange, second oldest in the country.

Meanwhile, the exchange authorities have come to an in-principle agreement with the West Bengal Government, a few of its agencies/authorities to hand over the 10 acre land the exchange had earlier obtained for a proposed new exchange building and a financial hub on the outskirts of the city. Government agencies on their part have under taken to return Rs 8 crore, paid by the exchange towards price of the land. CSE would also get 60 per cent of the auction sale proceeds of 5-acre portion of the land. The exchange has been promised a total of 10-acre plot of land at Rajarhat, an upcoming satellite town of Kolkata. Fifty per cent of this land could be commercially developed and the balance would be meant for future home of the exchange.