NGX to Relax Entry Barriers to Target Technology Companies, Listing

Kingslsley Nwezeh, Adedayo Akinwale in Abuja and Nume Ekeghe in Lagos,

In a bid to attract technology companies, the Nigerian Exchange Group (NGX) is planning to ease its entry rules for firms in the sector.

The Chief Executive Officer, NGX, Mr. Temi Popoola, disclosed this on ‘Arise Xchange’ a programme monitored on Arise News Channel.

He said: “One of the things that you find is that whilst the traditional initial public offerings (IPOs) or traditional listings are happening as frequently as you would like within the technology space, a lot of capital raising capital formation is happening outside the traditional exchange.
“Now part of this is understandable. Because a lot of capital raising tends to be very early stage tends to be more participation certificate (PC) type on demand the best.

“But nonetheless, there are some companies that are mature enough in there that ideally could tap the markets. So we’re doing a lot of work to really look at the exchange rules, look at the sorts of barriers to entry and really ask ourselves how we can make those fit for purpose for technology companies.”

Also speaking on the performance of the market in 2021, he said: “Last year, we had about a seven per cent growth in market capitalisation of the equity asset class and equity listings. We saw close to a 12 per cent growth in the size of the fixed income listings that we have.

“And on the Exchange- traded Fund (ETF) asset class, we saw a decline in the number of ETF issuances, which was understandable because we’re coming from a very high base in 2020.

“One of the things that came through today is that if you look at performance globally, those markets that took a market friendly approach to dealing with the economic fallout of Covid-19, you’re seeing them come out of the pandemic, with economic and commercial standards being much stronger,” he added.