Reliance Capital (RCAP), one of the bidders for a stake in the Multi Commodity Exchange of India Ltd (MCX) has urged the Forward Markets Commission (FMC) to cancel all agreements between the bourse and Financial Technologies (India) (FTIL) Group without levying any penalties.
Seeks sweeping changes In its second letter to the FMC written on Friday, it has requested that all issues about related-party agreements must be resolved prior to final bidding. The company also said sweeping changes were required in governance, management and operational structure of MCX.
FTIL proposes to divest 24 per cent stake in MCX on the directions of the regulator that had declared the promoter not ‘fit and proper’. RCap also requested FMC to direct the bourse to engage independent third-party consultants to advise on the transition plan and facilitate induction of new technology and support partners through a global competitive tender.
Further, it also urged FMC to ensure complete transparency and level playing for all bidders. Earlier on April 22, RCap had written to the commodity market regulator seeking transparency in the MCX divestment process. It also suggested that FMC assumes full control of the proposed disinvestment process.
Reliance Capital also urged the regulator to direct MCX to place the entire PwC report in the public domain and provide an opportunity to all shortlisted bidders for the FTIL stake to conduct full due diligence on the books of account and operations of the bourse.
The PwC special audit report had revealed that MCX had entered into pacts with related trading parties and paid about ₹709 crore to FTIL and group firms without following proper documentation process. The PwC report had raised extremely serious issues highlighting the potential violation of SEBI and FMC guidelines.