Plans by the Nigerian Stock Exchange (NSE) to transform into a company owned by shareholders have advanced as the Federal High Court, Lagos has now granted an order sanctioning the Scheme of Arrangement for the demutualisation of the NSE.
Demutualization is a complex process that involves transitioning a company’s financial structuring from a mutual company structure to a shareholder supported structure.
Commenting on this development, the Chief Executive Officer of the NSE, Oscar N. Onyema, said: “The NSE demutualisation process is moving ahead in line with the expected sequence of events, following the conclusion of its Extraordinary General Meeting 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 today we have received court sanction for the results of the EGM, in particular, the Scheme of Arrangement and we are looking to secure the reregistration of the Exchange as well as the approval of the Securities and Exchange Commission within the coming months.”
Members of the NSE had 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, the Securities and Exchange Commission of Nigeria 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.