NEW DELHI -- Bangladesh's stock exchange has selected a Chinese offer for a 25% stake in the bourse, although the decision still requires a green light from authorities, which appear to favor a competing Indian bid.
In an effort to modernize, the Dhaka Stock Exchange is selling a quarter of its 1.8 billion shares to foreign players. A consortium of China's Shanghai and Shenzhen bourses offered to pay 22 taka per share for a total of 9.9 billion taka ($119 million), in addition to $37 million worth of technical support. Meanwhile, India's National Stock Exchange, Nasdaq of the U.S. and other partners offered 15 taka a share.
The DSE board unanimously chose the Chinese bid, according to Chairman Abul Hashem. The proposal now awaits final approval from the Bangladesh Securities and Exchange Commission, which met with Vikram Limaye, CEO of the Indian exchange, who flew to Dhaka on Feb. 11 to urge the securities industry watchdog to consider non-financial factors as well.
The fight over the DSE is part of a greater rivalry between China and India in their efforts to boost geopolitical influence in South Asia. The future of Bangladesh's financial market could impact on the outcome of their competition.