NSE clears Airtel Africa for listing today

…As equities market capitalisation dips further by N33bn

Motolani Oseni

The Nigerian Stock Exchange (NSE) has issued a waiver for Airtel Africa despite not meeting the shareholders’ requirement needed to list for an Initial Public Offering (IPO) on Nigeria’s bourse, the listing which holds today July 5, 2019.

This is even as activities on the equities market sustained negative trend on Thursday with the market indicators dropping further by 0.26 per cent.

Airtel Africa had announced plans to list its shares on the stock exchange, but the company couldn’t gather the needed 300 shareholders mandatory for any company looking to list on NSE.

Airtel was only able to pull 130 shareholders. This prompted the NSE to waive the requirement for the company.

While addressing issues relating to the waiver at a pre-listing media briefing yesterday, NSE said it believed Airtel Africa would eventually meet the requirement in a stipulated the time which wasn’t made public.

Airtel had previously listed on the London Stock Exchange (LSE), closing its first day of trading in disappointment.

The listing exercise was one of the worst debuts of stocks in international market this year, as the company’s share price slumped steeply by 16per cent on its first day of trading despite offering shares below its valuation.

The reason why Airtel Africa failed to meet shareholders’ requirement was linked to the company’s the route to market, which was targeting certain investors and limiting qualified investors to two category of investors.

During the media chat, NSE said Airtel Africa had met the free-floating requirement for crossborder secondary listing which was rated at 10 per cent, with the network operator accounting for 25per cent.

But despite waiving Airtel Africa to list, NSE described the IPO as below listing standard (BLS).

Explaining why it gave Airtel the all-clear, The NSE says its rule gives the stock exchange regulators the power to waive such requirement for a company that has the ability to meet up with the numbers in a certain period.

“As social investors begin to unburden what they have, we expect that the numbers will go up. When we look at the requirements for shareholders, we know that it’s something they can meet up within the nearest future.

So since our rules as approved by the SEC grant us the power to give such a waiver, we looked at it, there was no significant risk for not meeting those 300 for now, we decided to grant that waiver for now.”

However, the NSE disclosed that companies which do not eventually meet this requirement will be classified ‘below listing standard and a CSI code’ which is like the ‘buyer beware mark.’

Meanwhile, the All Share Index, which opened at 29,375.25, lost 75.16 points or 0.26 per cent to close at 29,300.09.

Also, the market capitalisation of listed equities shed N33 billion or 0.26 per cent to close at N12.914 trillion against N12.947 trillion reported on Wednesday.

Analysts at Afrinvest Limited said they expected the bearish streak to be sustained in the absence of catalysts to stimulate investors’ sentiment.

Also, an analyst at Imperial Asset Managers Limited also expected the market to continue within the existing range today amid bargain hunting on low priced stocks.
An analysis of the price movement chart shows that NASCON led the gainers’ table, appreciating by 70k to close at N15 per share.

Cement Company of Northern Nigeria Plc followed with a gain of 50k to close at N15, while Dangote Sugar Refinery gained 45k to close at N11.45 per share.

Custodian and Investment also garnered close a N6.25, while Ecobank Transnational Incorporated increased by 40k to close at N10.40 per share.