The Telegraph
Saturday , March 15 , 2014
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MCX-SX chairman quits

Pillai: Exit mode

Mumbai, March 14: G.K. Pillai, the former home secretary, today resigned as the chairman of MCX Stock Exchange(MCX-SX) just a day after the Central Bureau of Investigation (CBI) registered a preliminary inquiry into the grant of the licence to the exchange.

After Pillai’s resignation, Thomas Mathew T., the former chairman of Life Insurance Corporation (LIC), was appointed as the chairman of the bourse. Similarly, Ashima Goyal, Professor at Indira Gandhi Institute of Development Research (IGIDR), will assume the role of vice chairperson.

Pillai told reporters after a board meeting of MCX-SX here today that he had resigned on account of “personal reasons”.

However, his resignation did raise eyebrows since it comes only a day after the CBI registered the preliminary inquiry into the grant of licence to the exchange in 2008 and the renewal of its recognition in 2009 and 2010. Pillai was not the chairman of the exchange when this had happened.

Soon after the investigating authority launched a probe, there were reports that Pillai and other board members like Thomas Mathew, Ashima Goyal and D.R. Dogra might also step down after today’s emergency board meeting.

It was believed that these four members would submit their resignations since they were of the view that the CBI inquiry would jeopardise the prospects of MCX-SX and make it difficult to engage any strategic investor.

However, in a press statement issued early this morning, MCX-SX clarified that the board meeting was not an “emergency meeting” but a regular one and had been planned a month in advance.

in order to block calendars of all board members, even as it said that it would be speculative to pre-empt resignation of all the public interest directors (PIDs).

“I took charge of the exchange at a time when it had several challenges. However, in the last few months, we have managed to appoint a new board and MD & CEO to take charge of the exchange. The ongoing rights issue is on track and we have received confirmation from several shareholders for participation. We have also been successful in rationalising costs in a significant manner, which will improve our balance sheet in times to come,” Pillai added.

Thomas Mathew, the new chairman of MCX-SX, said the immediate priority would be to successfully complete the proposed rights issue that will provide capital to the exchange. He said the main focus would now be to increase the turnover at MCX-SX.

Senior management officials said the ongoing rights issue, which will be in the ratio of 2:1, has received good response. The exchange has also received expression of interest from new investors. It may also consider a preferential allotment after the rights issue.

The exchange also announced that both Financial Technologies India Ltd and MCX were no longer promoters of the bourse and had been reclassified as public shareholders.