Calcutta, June 20: The shareholders of the Calcutta Stock Exchange today gave their consent to the local bourse’s proposal to sell its three-acre land off EM Bypass. The move will help the exchange to mobilise much needed funds to recover from its present crisis and avoid a potential derecognition by market regulator Sebi.
The stock exchange expects to garner about Rs 250 crore through the sale of land. The CSE board plans to utilise the proceeds to pick up a stake in a clearing corporation, which will allow the bourse to restart its own trading platform C-star and improve its net worth.
“We have got the necessary consent of the shareholders at today’s extraordinary general meeting,” B. Madhav Reddy, managing director and CEO of the CSE, told The Telegraph. The CSE had received Sebi’s consent to sell the land last month.
“The fact that Sebi had given consent to sublease our leasehold land at EM Bypass through its letter dated May 26 goes to show that there is no question of the closure of exchange,” Reddy said.
The CSE possessed 10 acres of land off EM Bypass on lease from the Calcutta Municipal Corporation (CMC). This was later reduced to 5 acres in 2008, while another 5 acres was given in Rajarhat.
This was done to expand the state government’s fairground adjacent to the plot. The CSE’s landholding was further reduced to 3 acres after an agreement with the CMC.
Reddy also said the CSE had entered into a memorandum of understanding with several regional stock exchanges for a possible takeover.
“We have entered into a memorandum of understanding with various regional stock exchanges such as the UP stock exchange, MP, and OTC Exchange of India,” Reddy said, adding that such mergers are expected to strengthen the CSE and increase its trading volume.
In 2012, Sebi had come up with guidelines on exit options for various stock exchanges.
According to the guidelines, any regional bourse with an annual trading turnover in its own platform of less than Rs 1,000 crore will be derecognised by the regulator.