The members of the Nigerian Stock Exchange have approved the listing of the Exchange as a public company under the demutualisation programme. This decision was reached at the Extra-Ordinary General Meeting of its members which held on Thursday at the NSE in Lagos.
The members also approved the appointment of South African bank, FirstRand, and local investment firm, Chapel Hill Denham, to guide it through the process of becoming a listed company.
At the meeting, President Association of Stockbroking House of Nigeria, Patrick Ezeagu, moved the motion for the demutualisation of the NSE and was supported by the past President of ASHON, Emeka Madubuike.
Other motions unanimously adopted by members present were: that the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the demutualisation be ratified and approved; and that the National Council and Management be authorised to do all such things and exercise all such powers as may be necessary or incidental to achieving the demutualisation objective, subject to applicable laws and regulations and obtaining the approvals of members and the relevant regulatory authorities.
The Johannesburg Stock Exchange, the continent’s most developed stock market, has been a listed company since 2006.
The NSE Council President, Mr. Aigboje Aig-Imoukhuede, read out the prayers as one, while the President, Chartered Institute of Stockbrokers, Oluwaseyi Abe, moved the motion for adoption of the prayers and was seconded by Oladipo Williams.
The members thereafter voted unanimously in favour of the prayers. Speaking after the meeting, Aig-Imoukhuede noted that “the approval of the NSE demutualisation plan marks the achievement of an important milestone towards completion of the exercise.
“The demutualisation of the Exchange will bring the Nigerian capital market on a par with other international jurisdictions, result in enhanced governance, transparency and visibility while attracting strategic partners, investors and good quality issuers. These are historic times indeed”.
Also commenting on the development, the Chief Executive Officer, NSE, Oscar Onyema, noted that “the approval of the demutualisation process will generate substantial motivation for the development of an agile Exchange thereby consolidating its innovativeness and strengthening its leadership both at local and international levels whilst also adding value to its stakeholders.
“As a demutualised entity that is profit-seeking, the NSE will be in a better stead to capitalise on new income opportunities, free from any limitations arising from conflicting member interests and existing laws and more importantly be able to better support the economic growth of Nigeria.”
Demutualisation is the process through which any member owned organisation becomes a shareholder-owned company. Basically, it refers to the conversion of a non-profit, mutually owned company to a for-profit entity limited by shares.