Members of the Nigerian Stock Exchange (NSE) have passed requisite resolutions for the demutualisation of The Exchange at a Court Ordered Meeting (COM) and an Extraordinary General Meeting (EGM) at the meetings held on Tuesday, March 3, 2020 at the Grand Banquet Hall, Civic Centre, Ozumba Mbadiwe Avenue, Victoria Island, Lagos.
For clearer understanding, Demutualization is the process by which a customer-owned mutual organization ( mutual) or co-operative changes legal form to a joint stock company.
Bit-by-bit details of the meetings showed that members voted and assented to: The re-registration of the Exchange as Nigerian Exchange Group Plc; The transfer of its securities exchange licence and other assets required to carry out the securities function to Nigerian Exchange Limited.
Also they voted for the establishment of a separate subsidiary company to be charged with the regulatory functions of The Exchange post-demutualisation to be called NGX Regulation Limited.
The 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)
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
The provision of Claims Review Shares totalling 40,083,999 ordinary shares, representing 2% 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
The transfer of the assets of NSE Consult Limited, NSE Nominees Limited and Coral Properties Limited – existing subsidiaries of The NSE – to the Nigerian Exchange Group Plc.
Following the COM, members reconvened for the EGM to determine the Board of Directors of the demutualised Exchange, and explore the implementation of an Employee Share Ownership Plan (ESOP). During the business of the day, the following Directors were nominated and appointed:
Otunba Abimbola Ogunbanjo – Chairman and Non-Executive Director
Mr. Oscar N. Onyema, OON – Chief Executive Officer and Managing Director
Dr. Umaru Kwairanga – Member and Non-Executive Director
Mrs. Fatimah Bintah Bello-Ismail – Member and Non-Executive Director
Mr. Oluwole Adeosun – Member and Non-Executive Director
Mr. Chidi Agbapu – Member and Non-Executive Director
Mr. Patrick Ajayi – Member and Non-Executive Director
Dr. Okechukwu Crescent Itanyi – Member and Independent Non-Executive Director
Mrs. Nimi Akinkugbe – Member and Independent Non-Executive Director
Prof. Enase Okonedo – Member and Independent Non-Executive Director
Mr. Ikpobe Apollos Oghooritsewarami – Member and Independent Non-Executive Director
Mrs. Ojinika Nkechinyelu Olaghere – Member and Independent Non-Executive Director
Making remarks at the EGM, President of the National Council, NSE, Otunba Abimbola Ogunbanjo, said, “I feel elated that 19 years after initiating the process to demutualize and on the 60th anniversary of the Exchange, we are close to achieving the goal.
“The successful demutualization of the Exchange was one of my main objectives when I assumed the Presidency of the Exchange and I am particularly happy it has been achieved during the life time of one of its founding fathers, Pa Akintola Williams.
“In telling the story of how we have achieved this milestone, we recognize the efforts of several actors’ involved in this project – including the management and staff of The Exchange, our members, professional advisers, the Federal Government of Nigeria, the Securities and Exchange Commission (SEC) and other capital market stakeholders – without whom it could not have become a reality.”
In his comments on the successful outcomes at the meetings, Chief Executive Officer, NSE, Mr Oscar Onyema said, “Today’s meetings move the demutualization process significantly forward and the positive outcomes affirm the great interest from members to support the pivotal restructuring of the exchange to become globally competitive. In furtherance of our plans, we will move to file the necessary resolutions from the COM and all other required documents at the CAC and SEC, obtain the Court Order sanctioning of the Scheme, complete all necessary registrations and seek the final approval from the SEC to ultimately demutualise.”
Members of the NSE had approved the demutualisation scheme of The Exchange at an Extraordinary General Meeting (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, the Securities and Exchange Commission of Nigeria (SEC) in a No Objection letter gave its consent to the NSE to hold the COM and EGM that would facilitate its conversion from a not-for-profit entity limited by guarantee into a profit-making, public limited liability company owned by shareholders.
