Ahead of the voluntary delisting of First Aluminium Plc’s entire issued share capital, the company is to be suspended trading its shares on the Nigerian Stock Exchange (NSE).
The company’s shares will be placed on suspension, with effect from Wednesday, May 15, 2019. Recall that Nairametrics had earlier reported that the company was considering voluntary delisting from the NSE.
Why the delisting? According to a statement issued to the NSE and investing public, First Aluminium Plc explained that the decision to delist is not far from the fact that its shareholders are not benefiting from the company’s continued listing on the NSE, even as they are not getting exit opportunities either.
More so, First Aluminium Plc lamented that its shares have continued to trade at a significant discount to the intrinsic value, stressing that over the last seven years, there has been little or no trading activity on the shares held by the minority shareholders.
First Aluminium Plc was quoted as stating the following:
“THE SHARE PRICE WAS STUCK AT 50 KOBO FOR ABOUT SIX YEARS BETWEEN JUNE 2011 AND JUNE 2017, AND THEREAFTER EXPERIENCED FURTHER DIMINUTION, BOTH IN SHARE PRICE AND TRADING VOLUMES. OVER THE LAST 18 MONTHS DAILY AVERAGE VOLUME RANGED BETWEEN 2,815 TO ROUGHLY 2,918 UNITS DURING THE PERIOD JULY 2017 TO DECEMBER 2018. SHAREHOLDERS ARE NOT BENEFITING FROM THE CONTINUED LISTING AS THEY ARE NOT GETTING EXIT OPPORTUNITIES AND THEIR INVESTMENTS HAVE BEEN LOCKED UP, THEREBY FINDING IT DIFFICULT TO DISPOSE OF THEIR SHAREHOLDING. NEITHER THE COMPANY NOR ITS SHAREHOLDERS HAVE BENEFITTED AS THE COMPANY’S SHARES CONTINUE TO TRADE AT A SIGNIFICANT DISCOUNT TO THE INTRINSIC VALUE.”
Effect of the delisting: If and when First Aluminium Nigeria Plc eventually delists from the NSE, its shares will no longer be available for trading on the Nigerian bourse. It should be noted that a delisted First Aluminium will continue its operations as an unlisted public company.
About First Aluminium Nigeria Plc: First Aluminium Nigeria Plc is one of the first Nigerian companies to be listed on the Nigerian Stock Exchange. It was listed in the daily official list of the NSE in 1992.
ALUCON Holdings S.A. holds roughly 75.48% of the current shareholding with minority
shareholders accounting for about 24.52%.
SOMEONE SHOULD PLEASE HELP WITH AN INTELLIGENT AND CORRECT ANSWER
If I have 20,000 units of the shares of First Aluminum in my portfolio and the company finally get delisted, will I lost all the money I invested in it?
Hello, Mr Ani J.O. No, you will not. Normally, when quoted companies decide to delist their shares, they typically make plans to buy out minority shareholders such as yourself. This will not be any different for FAN.
Note, however, that you may end up getting less money at the end of the day; less than the initial capital you invested when you bought your 20,000 units shares.
I hope this answer is intelligent enough for you.
Best regards.