MCX-SX under cloud, chairman Pillai quits

Pillai’s exit came a day after CBI registered preliminary enquiry into the grant of licence to the exchange in 2008 and the subsequent renewals.

Sources said the government and Sebi have stepped in to allay the concerns of investors, trading members and other stakeholders in MCX-SX. They also said that both want the existing shareholders to play a more active role. Besides, they want shareholder directors to participate in the rights issue of the exchange.

Sources said the pressure will mount further on original promoters - FTIL and MCX - to pare their holdings. Major institutional shareholders in the bourse include IFCI, Union Bank  of India, Punjab National Bank, State Bank of India and HDFC Bank.

Finance minister P Chidambaram said he hopes that directors of MCX-SX would act in public interest and that there was an orderly resolution of the crisis.

Following the resignation of Pillai, former LIC Chairman Thomas Mathew T has taken over as new Chairman of MCX-SX, the country’s youngest stock exchange.

Pillai, who has cited ‘personal reasons’ for stepping down, said MCX-SX is run by a professional management team and has an eminent board.

He said: ‘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.’
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