•Says Commission Working On Crowdfunding Framework
Encouraged by the successful entry of telecommunications giant- Airtel Africa Plc, the Securities & Exchange Commission (SEC), said it has been approached by some offshore companies seeking dual-listing of their shares on the Nigerian Stock Exchange and the London Stock Exchange (LSE).
Ms. Mary Uduk, acting Director-General of the commission disclosed this while fielding questions from journalists on the sidelines of the annual meetings of the World Bank and International Monetary Fund (IMF) in Washington DC, which ended at the weekend.
According to Uduk, “consequent to the Airtel IPO, some offshore companies are in discussion with the commission for an IPO that will be dually listed in Nigeria and the UK.”
According to her, the dual listing of Airtel signifies the interest of the foreign issuers into the Nigerian capital market.
Moreover, she continued, the market has received a significant boost with the listing of MTN Nigeria and Airtel on the Nigerian Stock Exchange.
“The primary market has witnessed a new trend in the last one year with the listing of the telecom companies (MTN Nigeria) and also the recent IPO and dual listing of Airtel.
On the back of the listing of MTN Nigeria and Airtel, Uduk said it would be great for more companies in the oil and gas sector to list on the stock exchange.
“As you rightly said, the listing of MTN and Airtel was a very positive outcome and they substantial raised the capitalisation of the equities market. It also meant we now have the telecoms sector of the economy represented on the stock market,” she explained.
“Therefore, it will be great to also have the petroleum sector well represented on our market and having NNPC (state-owned Nigerian National Petroleum Corporation) will make it greater.
“Recall that one of the provisions of the petroleum Industry Governance Bill (PIGB), if approved, is to list 10% and an additional 30% of NNPC companies between five and 10 years.
“If this is done, it will significantly improve the size and performance of our market. Meanwhile, it will also be important for the NNPC companies to be well commercialised such that they can return positive profits to their shareholders.
“I believe that with the country’s potential in the oil and gas sector as well as with appropriate governance and commercialisation policy, investors, the market and the entire economy will benefit from such listing and it will be a great achievement indeed.”
Uduk assured that the commission would continue to seek new ways to expand the market and release instruments that would make investments easier.
Speaking on the performance of the Nigerian capital market so far this year, the acting DG said: “If you look at the equities market, especially on the NSE, the market has lost about 16% so far this year, on the back of relatively weak economic fundamentals and investor sentiments.
The commission, she continued, is working on a framework that would regulate the use of crowdfunding by small businesses to raise capital in Nigeria.
The move, she assured, is part of efforts by SEC to protect investors in the capital market, stressing that “investor confidence is central to our job as the regulator of the capital market. People must have the confidence to invest.
“With crowdfunding, private companies like SMEs can raise long-term funds, using regulated platforms. The platform of the crowdfunding will be regulated by the SEC.”
Still, on the market’s performance, she noted that with the year in its last quarter, there is hope that there would be “some improvement in the equities segment, especially as investors see opportunities to pick low-priced stocks.
“As you know, even in a down market, there are still opportunities, since what is down has a higher probability of rising.”
Photo caption: Left to Right: Director General, West African Monetary Institute, Dr. Ngozi Egbuna, Deputy Governor Central Bank of Nigeria, Mrs. Aisha Ahmad, and Acting Director General, Securities and Exchange Commission, at the ongoing annual meetings of the World Bank and International Monetary Fund (IMF) in Washington DC, Sunday