Stockbrokers Approve NSE Demutualisation Process

Goddy Egene and Nosa Alekhuogie

The dealing members (stockbroking firms) of the Nigerian Stock Exchange (NSE) yesterday approved the demutualisation programme of the exchange. The approval was given at the extra-ordinary general meeting (EGM) held in Lagos.

Demutualisation is a process of converting a stock exchange from a non-profit, mutual organisation, into a for-profit entity with the attendant separation of membership rights from trading privileges held by members of the mutual exchange.

While the Securities and Exchange Commission (SEC) had issued rules on demutuali- sation of exchanges, the NSE had appointed Rand Merchant Bank (RMB) and Chapel Hill Denham (CHD) as financial advisers for the exercise since 2015.

However, stockbrokers during annual general meeting (AGM) of the exchange held last year, called for more time to embark on more consultations before the demutualisation of the exchange. They had said after the consultations, an EGM should be convened where the council and management of the NSE will be authorised to commence the demutualisation process.

And at the end of the EGM yesterday, the dealing members gave their approval to the demutualisation process.

The Chairman of Association of Stockbroking House of Nigeria (ASHON), Chief O.P Ezeagu, moved the motion for all the items on the agenda to be taken as one and he was supported by immediate past Chairman of ASHON, Emeka Madubuike at the EGM.

Specifically, the brokers authorised the National Council and management of the exchange to proceed with the process leading up to the demutualisation of the exchange.

They also approved the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the demutualisation of the exchange.