Going by the listing requirement of the NSE, all listed companies must maintain a minimum free float for the set standards under which they are listed in order to ensure liquid market in their securities.
For instance, the free float requirement for companies on the main board is 20 per cent and 15 per cent for Alternative Securities Market (ASeM) companies. This implies that 20 per cent of issued capital of companies listed on the main board of the exchange must be available for trading.
The NSE had listed seven companies with free float deficiencies at the beginning of the year. The companies include: Dangote Cement Plc, Union Bank of Nigeria Plc, Capital Hotel Plc, Great Nigerian Insurance Plc, Chellarams Plc, Nigerian Ropes Plc and Wema Bank Plc.
However, THISDAY checks revealed last Friday Wema Bank Plc, which was given July 31, 2014 to comply with the listing requirement has done so and its name has been removed from the list, leaving six of them.
Dangote Cement Plc, which has 7.19 per cent deficiency is expected to comply by October 2016. Union Bank, with a 14.94 per cent deficiency has June 30, to comply. Great Nigerian Insurance Plc has a free float deficiency of 16 per cent has July 2016 to comply.
Capital Hotel Plc, Nigerian Ropes Plc and Chellarams Plc with deficiencies of 2.23 per cent, 5.20 per cent and 13.96 per cent to comply on April 2016, January 7, 2014 and December 2014 respectively.
NSE sources said Wema Bank formally informed the exchange of its compliance with the requirement through a letter dated July 31, 2014.
Follow link below;
http://www.thisdaylive.com/articles/six-companies-violate-nses-free-float-requirement/185985/
