Ahmedabad-based National Multi Commodity Exchange (NMCE) has initiated talks with other commodity exchanges for a possible merger or acquisition to comply with regulatory requirements, exchange officials have informed.

The exchange has a deadline till May 2017 to comply with the regulations pertaining to minimum net worth of ₹100 crore, as laid down by the Securities and Exchange Board of India (SEBI). The Exchange currently has a net worth of ₹71 crore.

According to the officials, the exchange is considering several aspects, including bringing an investor as well as a possible merger and acquisition with other commodity exchanges.

“Currently, talks are on with several exchanges. There could be mergers (with other exchanges). When we find a concrete proposal, we will go to the board. Before that, it is at the management level and under consideration,” said Anil Mishra, Managing Director of NMCE. The Other recognised national commodity exchanges include ACE Derivatives and Commodity Exchange Limited, Mumbai (ACE); Indian Commodity Exchange, New Delhi (ICX); and Universal Commodity Exchange Ltd, Mumbai (UCX), besides the operational regional commodity exchanges such as Rajkot Commodity Exchange (RCX) and Harpur Regional Exchange.

“The investors will be issued fresh equity. Hence, the stake of existing shareholders will get proportionately reduced. We are expecting some developments in next 2-3 months. We still have time till May 2017,” added Mishra.

Currently, NMCE promoters include the Central Warehousing Corporation (29.70 per cent), Bajaj Holdings Investment Ltd (12.82), Reliance Capital (8.72), Punjab National Bank (8.12), Gujarat Agro Industries Corporation (5.47) and NAFED (3.92).

Neptune Overseas Limited and Kailash Gupta, who hold about 30.38 per cent combined, had been declared not ‘fit and proper’ by the erstwhile Forward Markets Commission, in July 2011.

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