Oando crisis: Test on market integrity-Stakeholders
fears firm may delist from exchange
Cross- section of stakeholders in the Nigerian economy and the capital market have expressed mixed feelings on the developments in Oando Nigeria Plc, which they said if not well resolved would cast dent on the integrity of the Nigerian market.
They, however ,called on the Securities and Exchange Commission (SEC) to adopt a proactive means of market regulation than its traditional reactionary method, adding that searchlights should not be placed on just companies. but goings on in the firms.
Stakeholders, who reacted to the developments in the latest court’s action voiding the suspension on shares of the company, and baring the Securities and Exchange Commission (SEC) from entertaining petition from a none shareholders in the company, called on the commission to protect market integrity.
A stockbroker, who pleaded anonymity, told Daily Times Nigeria that the development in Oando, presents a litmus test on the commitment of market regulators to protect investors funds and boost confidence of both local and foreign investors.
The broker said that failure to address the underlying and latent issues raised by the ongoing crisis, could trigger a run on the market, ostensibly to be triggered by spiral effect of negative market sentiment occasioned by the crisis.
Oando Plc, on Tuesday, 23rd October, 2017, obtained an ex-parte order from the Federal High Court restraining the Nigerian Stock Exchange (NSE) from implementing a technical suspension on its shares.
While it was also reported that the apex capital market’s regulator has said that earlier findings reveals, the company declared dividends from unrealised profits, released false financial statements.
Meanwhile, capital market expert, and Principal Partner Matog Consulting, Mr. Matthew Ogagavworia, told Daily Times that irrespective of suspicions in many quarters that Oando might delist from the Exchange, said that the company thrives on high standard and may not consider delisting.
The expert however said that the development may lead to many disclosures that would further rock the market and investor confidence.
“The Company will not consider delisting, but we may have another fraud case on our hands” he said.
Urging the commission to be more proactive, Matog Principal Consultant said “SEC should pay more than a passing interest in the management of listed companies. They current focus on listing compliance only. They should do more than that. They should monitor what really happens at the company and be put in a position to act fast.
He said that the prevailing disclosure requirement by the SEC remains very shallow for an active regulation, even as he further argued that SEC , could get a shareholder to adopt the petition written by none shareholders of the company, in order to arrive at justifiable end of the crisis. “What does it take for SEC to get a Shareholder to adopt that same petition,”
Stories by Bonny Amadi
