By Dipo Olowookere
President of the National Council of the Nigerian Stock Exchange (NSE), Mr Abimbola Ogunbanjo, has disclosed that the exchange will establish a new company to regulate the market after the completion of its demutualisation most likely before the end of 2020.
Mr Ogunbanjo, in a scheme of arrangement released by the NSE to update the investing community on its conversion process to a public company, said this separate organisation would be called NGX Regulation Limited.
At the moment, the exchange regulates activities at the Nigerian stock market. It sanctions companies listed on its trading platform for infractions and carry out other functions it has been empowered to do.
The NSE is working hard to become a public organisation and have its shares traded at the stock market just like other firms on its trading floor.
Already, it has received the approval of the Securities and Exchange Commission (SEC), the apex capital market regulator in the country, as well as a court order to convey a meeting to make this a reality. This court-ordered meeting has been scheduled to take place on March 3, 2020.
Speaking ahead of the gathering, Mr Ogunbanjo said after the demutualisation, the corporate identity of the NSE will become Nigerian Exchange Group Plc and operate as a non-operating holding company with ownership of Nigerian Exchange Limited and its other subsidiaries.
In addition, he said the governance of the NSE will also change from the National Council to a Board of Directors, while the “exchange will set up a separate company that will be charged with the regulatory functions of the exchange post demutualisation pursuant to an arm’s length agreement. The incorporated regulatory entity for this purpose is called NGX Regulation Limited.”
In his recommendation, Mr Ogunbanjo said, “The National Council considers the terms of the scheme to be fair and the optimal approach to achieving the demutualisation of our exchange. The scheme is supported and recommended by the National Council.
“Accordingly, the National Council recommends that you support the Scheme and vote in favour of the resolutions to be proposed at the Court-Ordered Meeting as detailed on pages 44 to 45.
“If you are unable to attend the meeting in person, kindly complete and return the enclosed proxy form in accordance with the instructions thereon.
“Please note that the lodging of a proxy form does not prevent you from attending and voting in person, should you subsequently decide to do so. However, in such instance, your proxy will not be entitled to attend or vote at the meeting.”
Adedapo Adesanya