Nigerian bourse gets final approvals for demutualisation

The Nigerian Stock Exchange has received final approvals of its demutualisation plan from the Securities and Exchange Commission and the Corporate Affairs Commission.

With these approvals, the Exchange has now completed its demutualisation process, according to a statement on Wednesday.

It said under the demutualisation plan, a new non-operating holding company, the Nigerian Exchange Group Plc had been created.

The bourse said the Group would have three operating subsidiaries, namely Nigerian Exchange Limited, the operating exchange; NGX Regulation Limited, the independent regulation company; and NGX Real Estate Limited, the real estate company.

It said all the entities had been duly registered at the CAC.

TheNSE Council President, Otunba Abimbola Ogunbanjo, said, “Successful demutualisation was one of my fundamental objectives when I assumed the Presidency of The Exchange.  The SEC’s decision today to approve the NSE’s demutualisation plans brings this aspiration to a successful conclusion in a process that included the passage of the Demutualisation Act through the National Assembly.

“We are elated that this milestone has been achieved as we celebrate the 60th anniversary of the commencement of trading at the Exchange and now look forward to the future public listing of its shares on NGX Limited.”

The NSE said the approvals by the SEC and CAC signified that the NSE could activate its transition plan to a new operational structure and holding company.

According to the statement, the extensive transition plan, taking the group and its subsidiaries through to full operational launch, covers legal and practical changes to enable the functioning of the new corporate structure, with no loss of service and a seamless transition for market participants.

It said plan would also see the inauguration of boards for the new entities, staff reallocation to their respective functions within the subsidiaries, operationalisation of business plans and budgets, technology systems transfer, and the requisite arm’s length agreements between the entities.

The statement said ahead of its listing on NGX Limited, the shares of NGX Group would be available for bilateral trades to be executed in line with extant rules and regulations of the Nigerian capital market.

It said Ogunbanjo would serve as the inaugural chairman of NGX Group’s Board of Directors.

The new Group CEO of NGX Group, Oscar Onyema, said, “The Nigerian capital markets should play a role commensurate with Nigeria’s status as Africa’s largest economy. At the Nigerian Stock Exchange, we have a vision that the new group will become the premier exchange hub for Nigerian businesses and for the African economy.

“We are implementing a series of measures towards this goal, demutualisation being a critical milestone. The completion of demutualisation is a truly significant moment, and we welcome the new possibilities that have opened up for us today.”

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