Date:19/11/2007 URL: http://www.thehindubusinessline.com/2007/11/19/stories/2007111951500100.htm

Back Croupier Prive set to buy 5% stake in CDSL

FIPB nod for FDI in depositories

First of its kind
The approval is subject to final clearance from the Finance Minister
Under the existing norms, foreign investment up to 49% is allowed in infrastructure companies in the securities markets

Moumita Bakshi Chatterjee

New Delhi, Nov. 18 Marking the first FDI proposal in depositories, the Foreign Investment Promotion Board (FIPB) has given the go-ahead to Delaware-based Croupier Prive Private Equity Master Fund LP to acquire up to five per cent stake in Central Depository Services Ltd.

CDSL is one of the two premier depositories set up by the Bombay Stock Exchange, the National Stock Exchange, banks and financial institutions

The proposal involves purchasing the stake from the existing investor, Centurion Bank of Punjab, for about Rs 16 crore.

Croupier Prive’s case came up for discussion at FIPB’s meeting on Friday, and the approval is subject to final clearance from the Finance Minister.

Croupier Prive Private Equity is a limited partnership established on July 1, 2007 with Croupier Prive Private Equity Partners LLC, a Delaware-based limited liability company, as the general partner.

CPP Equity Partners LLC has two members – Horizon Asset Management Inc, a New York corporation (with total assets of about $10.4 billion under management in December 2006) and UOB Global Capital LLC, a global asset management affiliate of United Overseas Bank.

Under the existing norms, foreign investment up to 49 per cent is allowed in infrastructure companies in the securities markets, namely stock exchanges, depositories and clearing corporations.

While the foreign direct investment is capped at 26 per cent, foreign institutional investment is allowed up to 23 per cent.

In addition, no foreign investor is allowed to hold more than five per cent of equity in such companies directly or indirectly and the FDI is allowed with the specific prior approval of FIPB.

In its proposal, the company said that besides the investment, the “Croupier through the fund would act as a strategic partner to CDSL and strengthen the management and the organisation through its experience and pool of resources worldwide in the successful growth of its operations.”

“The Indian economy is growing at a rapid pace and companies need access to the capital markets to fund their strong growth,” it said.