Stake­hold­ers Back De­mu­tu­al­i­sa­tion of Nige­rian Stock Ex­change

THISDAY - - NEWSXTRA - James Emejo

Stake­hold­ers have ex­pressed sup­port for the pro­posed de­mu­tu­al­i­sa­tion of the Nige­rian Stock Ex­change (NSE), de­scrib­ing it as a cru­cial step to­wards boost­ing liq­uid­ity and growth of the econ­omy.

The Na­tional Assem­bly is cur­rently pro­mot­ing a bill to de­mu­tu­alise the NSE from a com­pany lim­ited by guar­an­tee to a com­pany lim­ited by shares.

De­mu­tu­al­i­sa­tion refers to the tran­si­tion from a mu­tual as­so­ci­a­tion of ex­change mem­bers to a lim­ited li­a­bil­ity com­pany which is ac­count­able to share­hold­ers.

The con­cept typ­i­cally sep­a­rates own­er­ship and vot­ing rights from the right of ac­cess to trad­ing on an ex­change.

At a joint pub­lic hear­ing or­gan­ised by the Se­nate and House of Rep­re­sen­ta­tives Com­mit­tees on the Cap­i­tal Mar­ket on a bill for an Act to fa­cil­i­tate the devel­op­ment of Nige­ria’s cap­i­tal mar­ket by en­abling the con­ver­sion and re-reg­is­tra­tion of the NSE from a com­pany lim­ited by guar­an­tee to a pub­lic com­pany lim­ited by shares and for re­lated mat­ters, 2017, stake­hold­ers agreed that the move was long over­due in or­der to stim­u­late liq­uid­ity in the sys­tem among other things.

Lead­ing de­lib­er­a­tions on the leg­is­la­tion, the spon­sor, Sen­a­tor Foster Ogola, who is the act­ing Chair­man, Se­nate Com­mit­tee on Cap­i­tal Mar­ket, said the NSE plays a crit­i­cal role in the coun­try’s fi­nan­cial mar­ket, ar­gu­ing that the con­ver­sion and re-reg­is­tra­tion into a pub­lic com­pany lim­ited by shares is es­sen­tial to de­vel­op­ing and strength­en­ing the mar­ket as well as en­hanc­ing the for­ma­tion of cap­i­tal for the ex­pan­sion of the econ­omy.

He said: “It is an­tic­i­pated that the de­mu­tu­al­i­sa­tion of the NSE will re­in­force the con­tin­u­ous growth and devel­op­ment of a dy­namic, fair, trans­par­ent and ef­fi­cient cap­i­tal mar­ket and thus sig­nif­i­cantly con­trib­ute to Nige­ria’s eco­nomic devel­op­ment.”

L-R: Newly in­stalled Dis­trict 911 In­ner Wheels Nige­ria, Adegbe­misola Fathiat Amoke Ru­fai; Guest Speaker, Prof. Olan­re­waju Adi­gun Fag­bo­hun; and Cel­e­brant’s hus­band, Bio­dun Ru­fai, at the in­stal­la­tion of Ru­fai in Ikeja, Lagos ...week­end

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