By Peter OBIORA investadvocate

Nov 29 2010 16.40 GMT

Lagos (INVESTADVOCATE)-NPF Microfinance Bank Plc is set to list N2.2 billion worth of shares on the Floor of the Nigerian Stock Exchange (NSE) in Lagos Nigeria on December 1, 2010 at N1.50k per share.

 

This is coming on the heels of a hybrid offer by the Microfinance Bank in August Year 2008 to raise  N2.0 billion by offering investors 338,812,797 and 417,192,203 Ordinary Shares of N1.00 each at N3.00 and N2.50 Kobo respectively.

 

The Rights Issue was on the basis of one new Ordinary Share for every one Ordinary Share held as at December 31, 2007.

 

However, as at the time of the hybrid offer, NPF Microfinance Bank affirmed in the offer document that they made no application to the Council of the NSE to list either the shares on offer or the existing shares of the Bank.

 

Lead Issuing House was FirstInland Capital Limited, while the Joint Issuing Houses were Integrated Trust & Investment Limited and SanTrust Securities Limited.

 

Worthy of note is the listing price of N1.50 Kobo share compared to the N3.00 and N2.50 Kobo respectively it sold at the hybrid offer.

 

The NSE had made a rule that companies should list at the prices which they sold their Private Placements (PP); which Apex Capital Market Regulatory Institution, the Securities and Exchange Commission faulted in their Committee Report on the Nigerian Capital Market (NCM) in February year 2009.

 

The Nigeria’s Exchange had affirmed that the rule was part of its detailed recommendations steps to a world-class Capital Market, this SEC faulted.

Rather, the SEC committee had advocated that to improve the process and terms of listing shares by introduction on the Stock Exchange; recommendation nine (9) that the rule which requires that companies that recently concluded Placements should be listed at the price of the Placement is not consistent with Market best practices.

 

“The rule that requires that companies that recently concluded Private Placements should be listed at the Private Placement price is not consistent with Market best practices” SEC noted in its Committee Report.

The SEC Committee affirmed that price at which recently concluded Private Placement instruments are listed in the Market should be determined by Market forces, with the understanding that the Market will re-price the Securities appropriately once listed.