Leading American exchange NYSE Euronext exited from the National Stock Exchange by selling its entire five per cent stake in the domestic bourse to Singapore's Temasek Holdings. In 2007,NYSE had acquired five per cent stake in the country's premier bourse for USD 115 million,valuing the NSE at about USD 2.3 billion. Singapore-headquartered Temasek Holdings said the transaction - of buying five per cent stake in NSE has received the necessary regulatory approvals. However,the entity did not elaborate on financial details. With the acquisition,Singapore government-owned Temasek Holdings joins other NSE shareholders,who include Indian and global banks,insurance firms as also domestic and overseas investment companies. Temasek Senior MD Manish Kejriwal,in a statement,said that the company sees its investment in NSE as a "good proxy" to India's economic growth and development of its capital markets. "Temasek continues to focus on investments in India and believes in its long-term potential," Kejriwal added. Even though officials did not comment on the reason behind NYSE exit from the domestic exchange,industry sources said that NSE's recent arrangement with Chicago Mercantile Exchange was the primary reason behind the move. "Globally,NYSE and CME are competitors and NSE's recent tie-up with the CME was the main reason for NYSE's exit," said a person close to the development. In March this year,NSE and CME entered into an agreement under which NSE will begin trading in futures contracts of Dow Jones Industrial Average (DJIA) and S&P 500,while Nifty - NSE's benchmark index - would be traded on CME. Commenting on Temasek buying five per cent stake,NSE Managing Director Ravi Narain said,"Temasek is a well-respected investor and we welcome them as a shareholder." Shares of close to 1,500 companies are traded on NSE with a combined market capitalisation of over Rs 60,00,000 crore. The average daily turnover at the exchange is close to USD 20 billion (about Rs 88,000 crore). In June last year,private equity firm Norwest Venture Partners bought a little over two per cent stake from IL&FS Securities Services in a secondary transaction for Rs 250 crore,thus valuing NSE at about USD 2.5 billion. Promoters of NSE include IDBI,IFCI,LIC,State Bank of India,ICICI Bank,IL&FS Trust,Bank of Baroda and Canara Bank,among others. Temasek owns a diversified USD 119 billion portfolio as at July 31,2009,concentrated principally in Singapore,Asia and the emerging economies.
