The Foreign Investment Promotion Board, the nodal body for approving foreign direct investment in the country, has given its nod to a proposal from Germany-based Deutsche Bank to buy a 5 per cent stake in the Delhi Stock Exchange.

The board approved the deal at a meeting last Thursday, an FIPB official said.

However, Deutsche Bank will be able to acquire the stake only if existing stakeholders are willing to sell, said Bharat Bhusan Sahny, director, Delhi Stock Exchange, which is in the process of reviving its operations.

According to the demutualisation norms of the Securities and Exchange Board of India, DSE has to offload a minimum of 51 per cent stake in the bourse, out of which a maximum of 26 per cent can be sold to foreign investors. Each single investor is allowed to buy a maximum of 5 per cent stake in a stock exchange.

So far DSE has sold 21 per cent of its equity to a total of five foreign investors. While four investors have bought 5 per cent each, another investor has acquired a 1 per cent stake, Sahny said.

Therefore, DSE members, who hold the equity, have headroom to offload another 5 per cent to a foreign buyer.