The Nigerian Stock Exchange (NSE) has concluded plans to represent the resolutions that will jumpstart the process of demutualization.
It is hoped that members of the Exchange, largely stockbrokers, will at an Extraordinary General Meeting (EGM) on March 30, in Lagos, consider and if possible pass three special resolutions that are expected to enliven again the process of demutualization.
According to a media source, the EGM is expected to authorize the national council and management of the Exchange “to proceed with the process leading up to the demutualization of the Exchange as well as ratify the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the demutualization of the Exchange”.
Members of the Exchange are also expected to empower the council and management of the NSE “to do all such things and exercise all such powers as may be necessary or incidental to achieving the demutualization objective subject to applicable laws and regulations and obtaining the approvals of members and the relevant regulatory authorities.
The Exchange has also embarked on intense lobby of its members to support the longstanding proposal to convert the Exchange into a public limited liability.
Recalled that the NSE was initially incorporated under the Companies Ordinance of 1958 on September 15, 1960 as a private company limited by guarantee with a share capital, it was re-registered as a company limited by guarantee without a share capital in 1990 upon the enactment of the Companies & Allied Matters Act, Cap C20, 2004, (CAMA), which replaced the Companies Ordinance (1958).
CAMA had required all companies limited by guarantee that had a share capital to be converted to companies limited by guarantee without share capital, thus the Exchange’s Memorandum of Association was duly altered and the NSE has since been a not-for-profit corporate legal entity without a shareholding structure.
The process of converting the Exchange from the not-for-profit limited by guarantee entity into a profit-making, shareholders-owned public limited liability company was launched in 2002 with the approval-in-principle of the conversion by the council of the Exchange.