Following an application to the Nigerian Stock Exchange (NSE) on the voluntary delisting of Great Nigeria Insurance Plc, the NSE has approved the delisting application.
According to NSE, the application was granted subject to GNI Plc’s evidence of opening an escrow account in the registers name and evidence that the shareholders who have accepted to exit have been paid.
The company had opened an escrow account with GTL Registrars and Data Solutions Limited and provided sufficient funds to shareholders, who, as of October 24, 2018, had accepted the exit consideration of 50 kobo per share. Which is the highest price at which GNI Plc shares were traded in the last six months preceding the date of the Annual General Meeting/Extraordinary General Meeting, where the resolution to de-list was passed
Reasons for delisting of GNI Plc
In an explanatory note to shareholders on its voluntary delisting, the firm said over the last five years, there had been little or no trading activity on the shares held by the minority shareholders.
It further noted that there has been a considerable fall in trading volumes over the last 12 months with an average daily volume of circa 1,200 units during the period of March 2017 to March 2018.
According to the company, shareholders are not benefiting from the continued listing as they are not getting any exit opportunity and their investments have been locked up as they find it difficult to dispose off their shareholding.
“Neither has the company benefited from listing on the Exchange as the company’s shares continue to trade at a significant discount to the intrinsic value. Moreover, the company is bearing unnecessary cost in complying with its listing obligations.”
The firm said the voluntary delisting would enable the directors of the company to exercise a regulatory provision that would shield the company from any enforcement of action that the exchange might effect, such as the outstanding free float deficiency.
About GNI
Great Nigeria Insurance Plc commenced business in 1960 and following Central Bank of Nigeria (CBN)’s directive that required banks to either divest from non-core banking subsidiaries or form holding company to hold those subsidiaries; Wema Bank divested its 75% equity stake in GNI Plc to Insurance Resourcery and Consultancy Services Limited.
