The Nigerian Stock Exchange (NSE) said its members have approved the demutualisation programme of the Exchange.
This decision was reached at an extra-ordinary general meeting (EGM) held yesterday in Lagos.
Demutualisation is the process through which any member-owned organisation becomes a shareholder-owned company.
Basically, it refers to the conversion of a non-profit, mutually-owned company to a for-profit entity limited by shares. It segregates ownership and management from the trading rights of the members of an Exchange.
The national council and management of NSE led by the president of the Association of Stockbroking House of Nigeria (ASHON), Patrick Ezeagu, authorised NSE to proceed with the process leading up to the demutualisation of the Exchange and approved the engagement of financial advisers, legal advisers, tax advisers and any other adviser that may be required for the demutualisation of the Exchange.
The council president of NSE, Mr Aigboje Aig-Imoukhuede, said that, “The approval of the NSE demutualisation plan marks the achievement of an important milestone towards completion of the exercise.
“The demutualisation of the Exchange will bring the Nigerian capital market on a par with other international jurisdictions, result in enhanced governance, transparency and visibility whilst attracting strategic partners, investors and good quality issuers. These are historic times indeed.”
Also commenting on the development, the chief executive officer, NSE, Oscar Onyema, noted that the approval of the demutualisation process would generate substantial motivation for the development of an agile Exchange thereby consolidating its innovativeness and strengthening its leadership both at local and international levels whilst also adding value to its stakeholders.
According to him, as a demutualised entity that is profit-seeking, the NSE would be in a better stead to capitalise on new income opportunities, free from any limitations arising from conflicting member interests and existing laws and more importantly be able to better support the economic growth of Nigeria.