Comments
The government has finalised the share swap ratio for the proposed merger of crisis—hit NSEL with its parent Financial Technologies, which itself will not get any share.
With regard to creditors, the Ministry said their rights would be the same in the merged entity as they are now in NSEL.
Under the swap ratio, decided by the Ministry, NSEL shareholders would get three shares of Financial Technologies (India) Ltd (FTIL) for every eight shares held in spot bourse.
Following the Rs 5,600 crore fraud coming to light at the National Spot Exchange Ltd (NSEL), the Ministry, through a draft order in October last year, had proposed the merger of the bourse with FTIL.
The draft merger order, issued by the Corporate Affairs Ministry, has already been challenged by Financial Technologies (India) Ltd.
There are seven shareholders in NSEL, including FTIL and National Agricultural Cooperative Marketing Federation of India (NAFED). The rest five are nominees of FTIL.
Post merger, FTIL should issue and allot three shares of Rs 2 apiece for every eight equity shares of Rs 10 each held in NSEL, according to the nine—page assessment order issued by the Ministry.
As per the order, dated April 1, NAFED stands to receive 38 shares of FTIL, while 4.5 crore shares held by FTIL and its nominees in the exchange would be “cancelled“.
Further, it said the assessment order “shall be effective, if and only if, the central government finally decides to amalgamate NSEL with its holding company FTIL“.
The swap ratio has been decided after considering the fair value of NSEL at Rs 77 a share and the calculation was based on latest audited financial statements of the bourse as on March 31, 2012.
For FTIL, the fair value has been pegged at Rs 208 per share.
The fair values for FTIL and NSEL were recommended by independent valuer Lodha & Co.
“The interest in or rights of the creditors of dissolved company (NSEL) as against the resulting company are not proposed to be less than their interest in or rights as they had against the dissolved company,” the Ministry said.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.