The merger will help NSE and MCX cement their leadership position both in the equities and commodity derivatives space
Market News : The National Stock Exchange (NSE) and the Multi Commodity Exchange (MCX) entered into merger talks ahead of the implementation of the universal exchange framework in October, said a top official. The two entities are planning to approach market regulator Securities and Exchange Board of India (Sebi) as early as this month, according to the official.
The merger will help NSE and MCX cement their leadership position both in the equities and commodity derivatives space.
Both the exchanges have readied a blueprint for the merger proposal which will be discussed with Sebi. Sources say NSE entered talks with the commodity bourse soon after the market regulator allowed exchanges to dabble both in the equities and commodities space. The decision was taken by the Sebi board at its December 2017 meet.
NSE spokesperson said, “We will not comment on market speculations.” An query sent to MCX did not elicit immediate response.
Sources say that NSE which already has a strong hold in equity and index derivatives wants to be leader in the commodity segment as well.
“Commodity space is still evolving and has great opportunity to develop in the current scenario. So, having a dominant player will help bring in lot of economies of scale,” explained a person in the know.
In the equity derivatives space, NSE has near monopoly, while in commodity derivatives MCX enjoys a lion’s share of 90 per cent.
“It is premature to share any further details of the proposal, since talks are still in the preliminary stage,” said the official cited above.
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