S&P Dow Jones looking to sell stake in Asia Index joint venture to BSE
Sources close to the matter have described the decision to part ways between S&P and BSE as ‘amicable’.
S&P Dow Jones Indices (SDJI) is reportedly exiting Asia Index, its joint venture with the Bombay Stock Exchange (BSE) for providing financial market indices.
The BSE is set to acquire the 50 percent stake held by the S&P unit in the company, The Economic Times cited sources as saying. While the exact size of the deal was not known, the transaction is expected to be finalised within the first quarter of the current financial year.
The Indian exchange confirmed that discussions were on. “S&P Dow Jones Indices (a division of S&P Global) is in discussion with the bourse for divestment of its equity stake in Asia Index. This will be an important area of focus in the coming year,” it said in its earnings release on May 8.
The index unit would be an “important auxiliary business” for BSE, the report cited an exchange official as saying.
Moneycontrol couldn’t verify the report independently.
The development comes after the Securities and Exchange Board of India (SEBI) in March said that the index providers managing key indices based on securities listed in India be registered in the country. The move aims to enhance transparency in financial benchmark administration.
Rival bourse the National Stock Exchange (NSE) wholly owns its index provider.
Before partnering with BSE, SDJI had a collaboration with NSE. A year after SDJI and BSE came together in 2017, difference cropped up between the two. BSE tried to terminate the partnership but the Singapore arbitral tribunal declared the termination invalid.
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Sources described the decision to part ways as “amicable”. The New York-based S&P also owns domestic rating agency CRISIL, which has a market capitalisation of Rs 31,539 crore.