‘Trading of Demutualised NSE Shares to Boost NASD Activities’


Goddy Egene
The NASD Plc, the platform where shares of unlisted public limited companies are traded over-the-counter (OTC) is to witness a boost once the process of demutualising the Nigerian Stock Exchange (NSE) is completed.

A source close to the NASD Plc said shareholders who may want to trade their shares would be using the platform, which currently has firms such as Central Securities Clearing System Plc, WAMCO, Afriland Properties Plc, among others.

“As you know, NASD has been a platform where investors of public companies that are not listed on the NSE have been getting liquidity for their investments. And I am convinced that some of the brokers, who would now become shareholders of the demutualised NSE, may want to trade part of investments for liquidity and the NASD is where they will use for that purpose,” the source who pleaded to remain anonymous told THISDAY.

Capital market stakeholders had hailed the final approval given by members of the NSE to demutualise the Exchange and make it become a profit-making and limited liability company, saying it will benefit the capital market and economy.

Members of the NSE, who are mostly stockbroking firms, last week assented to proposal of the council to demutualise the Exchange.
They also approved that the Exchange will have a total share capital being N1,250,000,000 comprising 2,500,000,000 ordinary shares of 50 kobo each to be registered with the Corporate Affairs Commission (CAC).

In addition, they equally assented to the allotment of 1,964,115,918 ordinary shares to dealing members and ordinary members on the basis of a ratio of 78:22, respectively.

A claims review shares totaling 40,083,999 ordinary shares, representing two per cent of the Issued Shares of Nigerian Exchange Group, will be set aside for allotment to parties who are adjudged as being entitled to shares in the demutualised exchange was also set aside.

Although the Chief Executive Officer of the NSE, Mr. Oscar Onyema said the shares of the demutualised Exchange would not be listed yet, he said some of the shareholders could trade their shares on an OTC exchange.
A stockbroker and former NSE Council member, Garba Kurfi had said the demutualisation was a good thing because it is going to unlock more capital for the market.

“For instance, if I place shares as collateral, I can trade and make money, we are pleased this is coming after so much delay,” he said.
Also, another stockbroker, Mr. Samuel Ayo Oguntayo members who would be allotted their shares could trade those shares on over-the-counter (OTC) and make money.

Former Director General of NSE, Prof. Ndi Okereke-Onyiuke, had also said: “With this demutualisation, anybody in any part of the world can have access, the exchange will have a lot of money to execute high level plans that they have and people that will invest in the exchange will also make money. It is the best thing that will happen to the Nigerian economy.”