There was confusion as mid-week’s trading began, as the Nigerian Stock Exchange (NSE) management announced an April 9, 2018 directive from the Securities and Exchange Commission (SEC) lifting the six-month old technical suspension it placed on the shares of Oando Plc.
In a notice to traders and investors, titled “Notification of technical suspension on Oando Plc,” the NSE wrote: “We refer to our bulletins of 18, 20 and 23 October 2017 regarding the directive of the Securities and Exchange Commission (Commission) to The Nigerian Stock Exchange (The Exchange) to place the shares of Oando Plc (Oando) on Technical Suspension.
“Please be informed that on 9 April 2018, the Commission directed The Exchange to lift the Technical Suspension placed on the shares of Oando. On receipt of the Commission’s directive, The Exchange put the process in place to lift the Technical Suspension, including testing on its trading system.
“Further to the Commission’s 9 April directive, please be advised that effective today, 11 April 2018, The Exchange lifted the Technical Suspension placed on the shares of Oando. Consequently, there is no longer any impediment to price movement in Oando’s shares.
“The above is for your information and records update please.”
In a letter to Mrs. Ayotola Jagun, Oando Plc’s Chief Compliance Officer informing Oando management of the SEC decision in a letter on Tuesday, Ms. Tinuade Awe, its Executive Director, Regulation said “the exchange lifted the technical suspension placed on Oando’s shares after the close of trading today, 10 April 2018.
“Consequently, there will be no impediment to price movement in the shares of Oando when the market opens for trading tomorrow, 11 April 2018,” the NSE said in the letter.
In excitement, trading began on the company’s shares which on full bid with investors making 90.717m unmatched bids as tracked by TRW Stockbrokers. This expectedly sent the price to N6.60 per share, representing a 10.18% increase in less than three hours.
System Compromised
The excitement was however short-lived when to the chagrin of the general public, the SEC was said to have ordered a reversal of the decision within three hours. No reasons were however offer for the regulatory actions, amidst worries that it may have some political undertones, especially as the report of the forensic audit based on which the technical suspension was placed has not been presented.
Stockbrokers who spoke to Investdata News on condition of anonymity, while expressing sadness at the international embarrassment agreed that the system may have been compromised from the SEC end just to achieved a preconceived end that is not yet clear to anyone.
Expectations are that both the NSE and SEC would offer reasons to the general public for the directive and counter, which observers view as sloppy, a mockery and disgraceful for a market that needs all the confidence it can muster at a time like this.
Forensic Audit
The suspension was according to the SEC at the time to allow for a forensic audit of the company’s books following allegations of fraud and governance infractions, as well as the N325bn .
The audit was however delayed by a series of litigation by Oando Plc management and some of the companies aggrieved shareholders.
Withdrawal of the suits earlier in the year allowed for the audit by the firm of Deloitte to begin the audit, even as a peace accord was facilitated between Oando and Alhaji Dahiru Mangal, one of the petitioners, by Alhaji Muhammadu Sanusi III, Emir of Kano.
