The Chief Executive Officer, Nigerian Stock Exchange (NSE), Mr Oscar Onyema, says the demutualisation process of the exchange is moving ahead in line with the expected sequence of events.
Onyema, in a statement in Lagos at the weekend, said that the court had granted an order sanctioning the NSE scheme of arrangement for demutualisation.
Demutualisation of a stock exchange is a process by which non-profit, members/brokers owned mutual exchange is converted into a profit-seeking shareholder corporation, open to members of the public.
Demutualising an exchange, therefore, transforms it from being owned by members or brokers, to one with a different governance structure where members of the public can buy shares.
“The NSE demutualisation process is moving ahead in line with the expected sequence of events, following the conclusion of its Extraordinary General Meeting (EGM) and Court Ordered Meeting (COM) in March 2020.
“Understandably, in current circumstances, some of the legal and regulatory steps required have taken a little longer than originally expected.
“But we have received court sanction for the results of the EGM, in particular the Scheme of Arrangement, and we are looking to securing the re-registration of the exchange as well as the approval of the Securities and Exchange Commission (SEC) within the coming months,” Onyema said.
Recall that members of the NSE approved the demutualisation scheme of the Exchange at an EGM in March 2017.
This was followed by the signing of the Demutualisation of the Nigerian Stock Exchange Bill into law in August 2018.
In December 2019, SEC, in a No Objection letter, gave its consent to the NSE to hold the COM and EGM.
The COM and EGM were to facilitate its conversion from a not-for-profit entity limited by guarantee into a profit-making, public limited liability company owned by shareholders.
The NSE, on March 4, held COM and EGM where members sanctioned the planned demutualisation and also approved the appointment of the inaugural Board of Directors.