Merger of stock exchanges at GIFT City at advanced stage, to approach NCLT this month: IFSCA chairman

The proposal to merge the two international stock exchanges at GIFT City in Gujarat is at an “advanced stage” and is expected to reach the National Company Law Tribunal (NCLT) later this month, said K Rajaraman, chairman of International Financial Services Centres Authority (IFSCA).

“It is at a very advanced stage. The valuation of the two companies are currently being worked out. My view is that they will finalise their valuations and will approach the NCLT later this month,” said Rajaraman during an interaction with businessline on Tuesday. 

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The official said that BSE’s India International Exchange (IFSC) Ltd or India INX will be merged with NSE IFSC Ltd or NSE IX. “After the merger, NSE IX will continue to operate,” he added.

India INX, a subsidiary of BSE, was the first international stock exchange to be inaugurated by Prime Minister Narendra Modi at GIFT City in January 2017. A wholly owned subsidiary of National Stock Exchange, NSE IX followed soon after and began operations in June 2017.

“The two stock exchanges have to take the valuation proposal to their respective boards. That is what is pending. We are pursuing it,” Rajaraman added. 

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The move is expected to bring more volumes to the exchanges in GIFT City. The two exchanges together have an average daily trading volume of $2-3 billion. “It does not make sense to have so many exchanges. A lot of time and energy is being wasted with both of them competing with each other. The intent is to create synergies and save costs,” said a senior GIFT City official requesting anonymity.

The two exchanges currently offer a range of financial market products including single stock derivatives, currency derivatives, debt securities, among others.

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