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Antique Broking looks to merge with Fortune Financial Services

MUMBAI: Mumbai-based mid-sized brokerage firm Antique Stock Broking is exploring merger possibilities with Fortune Financial ServicesBSE 4.41 %, a BSE-listed broker, said three people close to the development. Antique has around 250 institutional clients and 150 employees, and the firm's website says it is promoted by Kriti Doshi, Gagan Chaturvedi and Rohit Kothari. 

While Doshi is an old-time stockbroker, Chaturvedi is the director of accounting and audit firm Chaturvedi & Shah. However, Chaturvedi is said to have resigned from the board of Antique some time ago, said one of the persons. Though Antique's Doshi and Fortune's founder Nimesh Shah declined to comment on the issue, people familiar with the development said a Memorandum of Understanding (MoU) was signed between the two parties. According to Antique's filing available with the ministry of corporate affairs, the broking company earned a net profit of Rs 16 crore on an income of Rs 83 crore for the financial year ended 2011, which is the latest data available on the website of the corporate affairs ministry. Fortune posted a net loss of Rs 13 crore on an income of Rs 63 crore for the financial year ended March 2013. 

Fortune was founded in 1991 by JT Poonja and Nimesh Shah, and has about 30 branches and 100 franchisees across India. Sudhir Valia, executive director of 
Sun Pharmaceuticals, and brother-in-law of founder Dilip Shanghvi, holds 5.4% stake in Fortune Financial. Valia holds this stake along with his wife Raksha. Earlier this month, Sharyans Resources picked up 15% in Fortune. One of the persons whom ET spoke to said Sharyans belongs to Valia, but this could not be independently ascertained. Fortune has 12 public shareholders, who together hold 78.92% stake in the company. Shah owns 13.11% in Fortune, as per the company's filing with BSE. Among the public shareholders, Europe-based Nogard Investment holds around 14% stake in Fortune through an investment made in 2008. 

Britain-based investors 
Lytton Grove Corp and Bomin Finance together hold 20% in the brokerage firm. Among other such deals in equity broking space, Coffee Day Holdings had acquired 50% stake in a Mumbai-based brokerage firm in 2011. In the same year, Networth Stock Broking, owned by broker SP Jain and Kolkata's Ajay Kayan, had merged with Ahmedabad's Monarch Projects.