Vitafoam implements FG’S regulation, cancels 1.14bn ordinary shares

SHAREHOLDERS of a leading manufacturer of rigid foams and and other household materials, Vitafoam Nigeria Plc have unanimously endorsed the company’s proposal to cancel 1,149, 155,936 unissued ordinary shares of 50 kobo each, in compliance with the Federal government’s directive to all companies in Nigeria.

President Mohammed Buhari had on august 7, 2020, signed into Law, the amended Companies and allied Matter act (Cama) of which Section 124 stipulates by December 31 this year, all companies in Nigeria should have only issued shares as against the current system of operating issued and authorised share capital.

Bamidele Makanjuola, Vitafoam’s Chairman, told the shareholders at the Company’s hybrid extra-ordinary general Meeting (egm) that Vitafoam had no basis to issue new shares to the shareholders and cancellation of the shares was the best option after evaluation. He underscored the need to comply with government’s directive ahead of the deadline, as a law abiding corporate entity.

“after a careful evaluation of the various options, the Board decided that cancellation of the unissued shares is in the best interest of the company at the present time as there is no basis to issue shares. it is based on the foregoing that this extraordinary general Meeting was convened to seek your approval to cancel all the company’s unissued shares in compliance with the provisions of section 124 of the Companies and allied Matters act (Cama 2020) and the Companies regulation 2021 and to also amend some provisions of the Memorandum and articles of association of the company accordingly, “says Makanjuola .

although some shareholders pleaded that the Company should convert the unissued shares to bonus issues, others believed that the timing was too short. However, the cancellation of the unissued shares was approved at the egm.