Nigeria’s bourse to appoint board prior to stock market listing

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Chijioke Ohuocha

ABUJA – The Nigerian Stock Exchange plans to appoint a board and pass resolutions next month to pave the way for its conversion into a publicly listed company, it said on Wednesday.

The exchange began changing its ownership structure from a mutual company of stockbrokers in 2017, adding new shareholders in a process known as “demutualisation”.

It said it would convene two meetings of members on March 3, to pass resolutions enabling it to become a listed company and also appoint a board for the new entity called the Nigerian Exchange Group Plc. It has not set a date for the listing.

The bourse, the second biggest in sub-Saharan Africa and one of the main entry points to invest in Africa, has around 200 listed companies, all included in its benchmark share index

Johannesburg Stock Exchange (JSE), the continent’s biggest and most developed stock market, has been a listed company since 2006.

Nigeria is Africa’s largest economy but the equities market has gone from being one of the world’s best performing frontier markets to one of worst after currency restrictions and low liquidity in 2015 deterred foreign investors.

Last year foreign players bought fewer stocks than the previous year as hopes for reforms that could lift the West African nation faded. Nigeria has been grappling with low growth since recovery from a recession four years ago.

This year, shares in the oil producing-nation have started to rally. But fears that a coronavirus outbreak could hit demand in China, one of Nigeria’s major trading partners, have reversed sentiment.

The bourse has said it hopes that the demutualisation will help it improve transparency, product development and deepen the market, leading to greater inflows from foreign investors.

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