Mumbai, 3rd June, 2009 — Norwest Venture Partners (NVP) and IL&FS Securities Services Limited (ISSL) have today announced that NVP has signed a definitive agreement to acquire 2.11% equity in the Mumbai-based National Stock Exchange of India Limited (NSE). NVP, a global, multi-stage investment firm, will purchase the shares of NSE for approximately Rs 250 Crores in cash from the selling shareholder, ISSL, valuing the Exchange at over Rs 12,000 Crores.
The valuation accorded to the NSE reflects its standing in global markets. While Exchange valuations have dropped dramatically in all developed markets, the NSE remains well regarded in terms of quality of operations, management and secular growth. This transaction has been approved by the NSE board of directors, and is expected to close within the next week.
It would be recalled that in November 2008, the Ministry of Finance had clarified that Foreign Institutional Investors could hold up to 23% of the equity in an Indian Exchange, even if such Exchange was not listed. The above Notification of Government has cleared the way for enhanced FII interest in the NSE, with NVP being the first FII to take advantage of this investment opportunity.
“The NSE is regarded as one of the best operated exchanges globally, with world-class technology systems, a proven management team, and a wide range of products and industry leading processes that are unrivaled in the industry,” said Promod Haque, Managing Partner, NVP. “We are extremely bullish on the value proposition NSE offers shareholders at a time when India is on the cusp of global influence. We look forward to working with Ravi Narain, MD, and his talented team of executives to help contribute to the growing success of the NSE.”
Added Sohil Chand, Managing Director, NVP India: “The Indian market continues to show great potential and the fundamentals of the Indian economy are strong. NVP is pleased to align itself with the largest stock exchange in India, whose entrenched market position, high liquidity, and national network footprint are incomparable, and future growth opportunities are extremely promising.”
Commenting on the deal Arun Saha, Chairman of ISSL notes, “NVP is an important addition to NSE’s marquee group of pedigreed global financial investors, and we are pleased to welcome the firm as a key stakeholder in NSE. NVP will contribute to building value in NSE as it continues to grow and expand its leadership position in India.”
About National Stock Exchange of India Limited
National Stock Exchange (NSE), established in the mid 1990s as a demutualised electronic exchange by leading Indian financial institutions offers trading, clearing and settlement services in a range of products covering equity, debt and equity derivatives. It is India 's largest exchange and ranks third globally by number of trades in the equities market. NSE provides a modern, fully automated screen-based trading system with nearly 40,000 trading terminals giving it extensive reach. NSE has played an important role in helping reform the Indian securities market and in bringing about transparency, efficiency and market integrity.
NSE introduced trading in equity derivative products in 2000-01 and in this short span of time has become the largest exchange in single stock futures and ranks fourth in index futures globally. Its flagship index, the NIFTY 50, is used extensively by investors in India and around the world to take exposure to the Indian equities market. For more information about NSE, please visit: www.nseindia.com.
About Norwest Venture Partners
Norwest Venture Partners (NVP) is a global, multi-stage investment firm that manages more than $2.5 billion USD in capital. It has offices in Palo Alto, California, Mumbai and Bangalore, India and Herzelia, Israel. NVP makes early to late stage venture and growth equity investments across a wide range of sectors including: technology, financial services, infrastructure, consumer, agriculture, manufacturing, telecommunications, retail and healthcare. NVP has actively partnered with entrepreneurs to build great businesses for more than 48 years and has funded over 450 companies since inception.
Notable investments include Actel Corporation, Airespace (acquired by Cisco Systems), Cerent (acquired by Cisco Systems), Corio (acquired by IBM), Cray Research, Documentum, Extreme Networks , Forte Software (acquired by Sun Microsystems), National Stock Exchange of India (NSE), OnMobile (NSE: OnMobile), Open-Silicon (acquired by Unicorn Investment Bank), PeopleSoft, Qumranet (acquired by Red Hat), Rackspace (NYSE:RAX), Siara Systems (acquired by Redback Networks), SideStep (acquired by Kayak), Spinnaker Networks (acquired by Network Appliance), Tivoli Systems (acquired by IBM), Transaction Systems Architects (Nasdaq: ACIW), Verio (acquired by NTT), Winphoria Networks (acquired by Motorola) and Yipes (acquired by Reliance/Flag Telecom). For more information, please visit www.nvp.com.
###
All brands, names, or trademarks mentioned in this document are the property of their respective owners.
Media Contacts:
Regi Philip
Norwest Venture Partners
Mobile: +91 98197 75137
Email: regi.philip@nvp.com
Katie Belding
Norwest Venture Partners
Phone: 650.321.8000
Email: kbelding@nvp.com