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Sunday, 30 August 2020

Commodity exchange structure is still debatable – sources

The private sector will get a piece of the new futures exchange even as gov’t agencies scramble for their share: Last Tuesday’s meeting called by the Financial Regulatory Authority (FRA) saw the EGX, CBE, and Misr for Clearing, Depository and Registry (MCDR) vie for ownership of the futures exchange, sources told Hapi Journal. But amid the haggling, one thing remained constant: no matter which way you cut it, partial private sector ownership of the exchange will be a reality. Three main ownership plans have been put on the table:

Scenario #1: The CBE, MCDR, and the EGX may hold a majority stake of 51% and they would discuss amongst themselves who takes what. The remaining 49% would be distributed among private banks, insurance companies, and funds who would each seek their own share in a private placement. A cap on private ownership of individual entities may be introduced in this scenario.

Scenario #2: 70-80% of the exchange could be owned by the private sector, while the CBE and EGX could own 20-30% minority stake.

Scenario #3: Expand the ownership structure significantly to distribute the stakes in equal parts of 2-3% to each of the public and private sector parties involved.

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