SEPTEMBER 4, 2018 – A new strategic investor, Eaton Acquisitions Limited, is seeking to acquire 10 per cent equity stake in NEM Insurance Plc, a major stake that will enable the new investor to take up board position at the insurance firm.
Eaton Acquisitions Limited has confirmed that it had acquired up to nine per cent equity stake in NEM Insurance, one percentage point below its target.
The Nation had two weeks ago reported exclusively that the new investor struck a cross deal to acquire additional 2.46 per cent equity stake in NEM Insurance. A total of 130 million shares of NEM Insurance were transferred in an off-market trade at N4 per share, representing a premium of 40.35 per cent against the closing share price of N2.85.
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As off-market, negotiated cross deals, it means that the deals were not subjected to the dynamics of price discovery for the particular period. Off-market trade implied that the deal was sealed outside the floor of the NSE.
The negotiated cross deal platform of the Exchange is a special-purpose trading platform that is meant for voluminous transaction. By the cross deal, it implies that the buyer and the seller had been prearranged and the transfer at the stock market was a mere perfection of the agreement between the two. The negotiated cross deal allows the parties to the deal to close the deal at reduced cost.
