BSE in preliminary talks for acquiring United Stock Exchange: report

Bombay Stock Exchange (BSE) is in preliminary talks for possible acquisition of United Stock Exchange (USE), which is grappling with business challenges, according to a senior official.

At present, the loss-making bourse is trading only in currency futures.

"The discussions for a possible acquisition of USE are at a preliminary stage," the official told PTI.

Without divulging any specific details, the official said that BSE is open for opportunities.

Leading stock exchange BSE is already a strategic partner in the bourse. It was the single largest shareholder in USE at the end of December, 2013.

Reflecting its business challenges, USE saw its net loss widen to Rs 57.13 lakh in the quarter ended December. It had clocked a net loss of Rs 5.28 lakh in the previous quarter.

Going by reports, USE's net worth is around Rs 115 crore which is only slightly higher than the minimum level of Rs 100 crore mandated under rules given by market regulator Securities and Exchange Board of India (Sebi).

BSE, Asia's oldest bourse, late last year had launched trading in currency derivatives. A possible deal with USE could bring in synergies for the exchange.     

Apart from BSE, private sector lender Federal Bank is another major shareholder. It help about 6 per cent in USE at the end of December quarter.

During the same period, many leading entities - including Standard Chartered Bank (Mauritius) Ltd, HDFC Bank, State Bank of India, MMTC and Jaypee Capital Services - held stakes in the bourse.