The Singapore Stock Exchange has emerged as the frontrunner for picking up a 5 per cent stake in the Bombay Stock Exchange ahead of its initial public offer in May.

The stock market regulator has stipulated that a single investor can pick up a maximum of 5 per cent in an Indian stock exchange.

Sources close to the development said the Bombay Stock Exchange had received offers that valued the exchange at $600-800 million. The offer by SGX was on the higher side of this range, they said.

Recently, the NYSE Group, General Atlantic, Goldman Sachs and Softbank Asian Infrastructure Fund each acquired 5 per cent in the Bombay Stock Exchange's competitor, the National Stock Exchange, for a price that put the enterprise value of the exchange at $1.20 billion.

There are other contenders as well for the Bombay Stock Exchange. They include the Deutsche bourse, NASDAQ and the London Stock Exchange. It, however, is not known whether the BSE is in favour of giving another 5 per cent stake to a second stock exchange.

The Bombay Stock Exchange will also have to give shares to private equity players, for which Temasek, GIC and a German private equity player are in the running. The valuations they have offered are not yet known.