The Board of Directors of AshakaCem Plc has proposed to delist all of the ordinary issued share capital of AshakaCem from listing on the Official List and from trading on the Main Market of the Nigerian Stock Exchange. In an explanatory note made available on the NSE website, directors of Ashaka Cement said the voluntary delisting follows the company’s violation of the exchange’s Free Float Deficiency provision of 20 percent.
According to the directors, Lafarge Africa Plc currently holds 84.97 per cent of Ashaka Cement, bringing the free float that is tradable on the NSE to 15.03 per cent as against 20 percent stipulated by the exchange.
The directors explained that is not improbable that given this free float deficiency, the NSE could take enforcement action and initiate a regulatory delisting, given that the free float deficiency is not likely to be remedied, hence the decision to delist and operate as an unlisted company.
Besides, the free float deficiency, the directors said over the last five years there is little or no trading activity with only 0.20 percent of the shares held by the minority shareholders being traded.
“Neither the company nor any shareholders are benefiting from the continued listing as shareholders are not getting any exit opportunity and their investments have been locked up and they find it difficult to dispose of their shareholding. Moreover, the company is bearing unnecessary cost in complying with its listing obligations,” the directors said.
The directors said minority shareholders of AshakaCem may exit prior to the delisting by trading their shares on NSE or receive 57 shares of Lafarge Africa Plc in exchange for 202 AshakaCem shares held as at the date of the special resolution approving the voluntary delisting.
In addition, a cash consideration of N2 per share will be paid to every shareholder exchanging their AshakaCem shares for Lafarge Africa shares.
The directors noted that where a shareholder desires to remain a shareholder of AshakaCem, such shareholder shall be free to do so and there is no obligation to trade their shares or receive the exit consideration.