NSE grants Airtel waivers for free float without meeting requirement

• As index slumps further by 0.3 per cent

The Nigerian Stock Exchange (NSE), has granted a waiver to telecom operator, Airtel Africa, to list its shares on the Exchange without meeting the minimum requirement of 300 shareholders on the day of listing, as approved by the national council.

Speaking in an interactive session with journalists, yesterday, the Head, Listing Regulation, NSE, Godstime Iwenekhai, said after Airtel’s book building, about 130 shareholders subscribed to issue, which is below the 300 stipulated by the Exchange.

Furthermore, the number of shareholders requirement was not the only provision the telco fell short off, as Airtel got approval for a free float of 25 per cent across the London Stock Exchange (LSE), and the NSE, which is also above the Exchange’s requirement of 10 per cent for cross-border listing.

Free float refers to the portion of shares of a company that are in the hands of public investors, as opposed to locked-in stock held by promoters, controlling-interest investors, or governments.

However, Iwenekhai explained that, “The Exchange cross-border listing requirements rule also grants the Exchange the powers to give exemption or waivers in every part of the rule, because the rule is developed in such a way to attract cross-border listing to the exchange.

“We have the requirements that we feel we can deploy to attract such big and foreign companies to Nigeria; the rule as approved by the SEC gives the Exchange the power to grant such requirement,” which enabled the management grant Airtel the waivers having met other stringent requirements in foreign listing.

“So, if you have a company that wants to list in NYSE, LSE, GSE, that are all members of WSA, we will know that they are also going to meet with the standards, having complied with the stringent listing requirements in the foreign destinations.”

However, he noted that the security of Airtel would be marked as Below Listing Standard (BLS), because they could not meet the requirement presently. “It is not a waiver that would last in perpetuity, waiver is granted for them to list at this level. By the time retail investors begin to come in, we expect the number of shareholders to increase, and they will eventually meet the shareholders requirement, and once that is done, we remove the BLS mark to shadow that they have fully meet with all the requirements of the exchange.

Nevertheless, the Airtel pre-listing did not change the market fortunes, as transactions on the trading floor sustained continued on a sliding profile, as more bellwether stocks suffered price depreciation, causing the All-share index to slump further by 0.3 per cent.

The All-Share Index (ASI), Thursday, shed 75.16 absolute points, a 0.4 per cent fall to close at 29,300.09 points. Similarly, the market capitalisation lost N33 billion to close at N12.915 trillion.

The decline was largely impacted by value depreciation recorded in the shares of Presco, Guaranty Trust Bank, Guinness Nigeria, Dangote Flour Mills, and Oando.

However, market breadth closed upbeat with 20 stocks rising against 16 falling in price. Cutix recorded the highest price gain of 9.22 per cent to close at N1.54 per share. Academy Press followed with 8.82 per cent to close at 37 kobo, while Livestock Feeds gained 8.51 per cent to close at 51 kobo, per share.