Nigeria's Assets: Sells and Holds


Monday, October 03 2016 8.12am /NASD Plc

Conventional thinking supports asset sales , it frees up cash; in Nigeria’s case- allows the Government to focus on governance and ,as a bonus;, provides a tiny relief to the pent up pressure for foreign exchange.

So why not?

There is no question of the significance of an offloading of up to 5% of Nigeria’s Liquefied Oil and gas company – [“NLNG”]. The sale will yield (by general estimates) up to $15 billion in cash to the country which translates to almost 80% of the 2016 annual budget.  

Sell advocates propose that this can jump-start improvements in productive capacity and facilitate key infrastructure developments. 

The Hold team however fears that the proceeds may well end up meeting unpaid salary bills and future costs of governance – feeding more unmatched consumption.

The Holds further point out that this is one successful holding out of a very limited number of national investments.  If the government sells its stake now, what can they sell in future? Sells support the idea of providing the infrastructure to allow successful companies to grow. 

Such holdings can be sold and the proceeds used to support even more diverse economic development.  Sells also see fierce defence and holding on to NLNG as a continuation (even if redirected) of our mono-income source culture.

A sale to the public (like the privatisations of the past) seems logical.  It will however require NLNG convert to a public company which is great for both the company and the country as it creates more transparency around the sale and allows the public to have a stake. 

Since the 5% stake however falls below the required share float threshold of a full stock exchange we expect trading of these holdings to initially commence on the equity OTC platform in line with SEC’s Rule on Trading Unlisted Securities.

NASD OTC is an Over-the-Counter Securities Exchange with a large and growing community of Traders, Investors and growing companies.  Our structure and rules accommodate offers for sale of small (below 10%) holdings and allow for extremely fast on-boarding of trading instruments. 

We look forward to the possibility of creating liquidity for the Federal Government & transparency for investors.

As at Friday, 30 September 2016, the index closed at 618.90 Points (up 1.44% on previous close of 610.09 Points).

Top 5 Trading Securities 2016 (YTD-30 September 2016)

PI Activity (For the Week Ended - 30 September 2016)

Market in Numbers (YTD - 30 September 2016)

Macro-Economic Indicators - 30 September -2016

Closing Prices as at 30 September 2016


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