MUMBAI (Reuters) - Jignesh Shah has stepped down as chief executive of Financial Technologies, the Indian trading software provider he helped found more than two decades ago that now faces a police investigation over the troubled winddown of a commodity exchange affiliate.
Financial Technologies (India) said Prashant Desai, who joined the company in 2013 to handle investor relations and mergers and acquisitions, would succeed Shah as the CEO.
Shah was appointed chairman emeritus of the company, and would serve as a mentor but “will no longer hold any executive or managerial position in the company”, the statement said.
The statement did not say whether Shah would relinquish his stake.
Shah controls about a 46 percent of the company’s shares, combining stakes he owns along with those of his family and his personal holding company La-Fin Financial Services.
Financial Technologies and Shah still face a police investigation over whether they were aware of the troubles at former affiliate National Spot Exchange Ltd (NSEL).
The commodity exchange was wound down last year after defaulting on obligations to counter-parties amounting to around 55 billion rupees ($897 million).
Shah was arrested earlier this year over the case and released on bail. The investigation continues.
In another blow to Financial Technologies, the central government proposed invoking a rarely used clause in India’s companies law to force the company to assume NSEL’s outstanding liabilities.
Shah was a former engineer at BSE Ltd, India’s oldest exchange, who founded Financial Technologies at a time when Indian exchanges were switching to electronic trading and used it as a platform to build stakes in exchanges around the world.
However, Financial Technologies has since sold most of its exchange holdings, including domestic exchange Multi Commodity Exchange of India and Singapore Mercantile Exchange.
Reporting by Rafael Nam and Himank Sharma, editing by David Evans