NEW DELHI: British bankers are. mounting an aggressive campaign to counter U.S. bankers who have been trying I woo Indian firms trying to raise capital in global security markets.
British Chancellor of the Exchequer (Finance Minister) Kenneth Clarke Jed a pack of London financiers engaged in a subtle tug-of-war with ‘American investment banks.
British bankers say U.S. firms like Morgan Stanley and J.P.Morgan have been lobbying with India’s Finance Ministry to allow firms to float American depository receipts (ADRs) listed in New York.
This could mean a possible loss of listing fees for the London bourse and fund management opportunities for British bankers.
Indian firms have been opting for global depository receipts (GDRs) coupons exchangeable for shares— listed in London or Luxembourg to raise capital in the world markets after the government allowed them to do so as part of an economic reform program launched in 1991.
But the GDR market has been sluggish for various reasons, making Indian companies look around for alternative avenues.
Bankers and analysts say the GDR market has been hit mainly by a weak dollar and a recent crash of the Mexican peso, besides dull conditions in the Indian stock markets and a slowdown after past purchases! Clarke told a seminar on trade that the London stock exchange offered the best means to access capital. “Listing in London means access to one of the largest listing centers,” he said. There are three times as many securities listed on the London bourse than in New York, he said.
Article extracted from this publication >> June 30, 1995
