THUR, DECEMBER 27 2018-theG&BJournal-Great Nigeria Insurance Plc (GNI)has told its shareholders that trading on the Nigeria Stock Exchange (NSE) is no longer a profitable idea and is delisting to seek growth elsewhere.
The insurance underwriting, financial advisory and real estate investments firm burdened by the extraordinary weight of the cost of listing threw in the towel after it became apparent nobody was interested in trading on its shares anymore.
Over the last 5 years, there is little or no trading activity on the shares held by the minority shareholders. There has also been a considerable fall in trading volumes over the last twelve months with an average daily volume of circa 1,200 units during the period March 2017 to March 2018.
‘’Shareholders are not benefiting from the continued listing as they are not getting any exit opportunity and their investments have been locked up and they find it difficult to dispose of their shareholding,’’ GNI noted in its notice to delist from the Exchange.
GNI added tersely too that the company has not benefitted 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.’’
It is not certain the company’s next move after the voluntary delisting. But options readily available is the OTC market but with full compliance with the exchanges.
The company served notice to delist on Christmas eve following the application made to The Exchange on the recommendation by the Board of Directors. It said The Exchange approved the delisting application but subject to GNI Plc’s evidence of opening an escrow account in the registrar’s name and evidence that shareholders who have accepted to exit have been paid.
GNI said it has opened an escrow account with GTL Registrars and Data Solutions Limited and provided sufficient funds to shareholders who as at October 24, 2018 have accepted the Exit Consideration of NO.50 per share based on the highest price of NO.50 at which GNI Plc. has traded in the last 6 months preceding the date of the AGM/EGM where the resolution to de-list was passed.
Through the Voluntary Delisting of GNI Plc, the Directors of the Company would be exercising a regulatory provision that will shield the Company from any enforcement of action that the Exchange may effect, for example by way of a Regulatory Delisting in light of the outstanding Free Float deficiency. Furthermore, through the delisting process, the Company would be providing an Exit Opportunity to minority shareholders who do not want to remain in an unlisted company.
‘’The consideration accruing to shareholders of GNI Plc that elect to accept the Exit Consideration have been computed as at October 24, 2018 (“the Collation Date”),’’ GNI said.
The cash consideration will be settled by way of electronic transfer to the respective bank accounts of Shareholders and it’s expected to be completed on or before 31 December 2018. Background on GNI Plc: GNI Plc is one of Nigeria’s foremost Insurance firms with a composite license that allows it to underwrite Life and General insurance business.
The Company started its operations in 1960, and has accumulated over 55 years of insurance underwriting, financial advisory and real estate investments.
The issued, subscribed and paid-up equity share capital of the Company is N1,913,742,190, made up of 3,827,485,380 units ordinary shares.
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