Sept 15, 2014/NSE
- What is technical suspension?
Technical suspension is the interruption of price movement in listed shares for a specified period so that any dealings in the shares which occur during the period of the suspension will not result in any change in price, which change may have occurred had the suspension not been implemented.
See also,
http://www.sec.gov.ng/sec-assures-investors-following-the-establishment-of-bridge-banks.
html (“Technical suspension means that trading on the Shares can continue without any change in price.”)
2. Under what authority can The Exchange place shares on technical suspension?
The relevant provision is in Chapter 2 of The Exchange’s Green Book (Listings Requirement) which addresses Subsequent Listing of Securities (In Respect of Companies Whose Securities Are Already Listed on The Exchange).
Clause 6 of Chapter 2 provides that:
“Subject to the provisions of this rule if the directors issue and/or offer to issue any shares in the original or any increase in the share capital of the company:
(i) For cash; or
(ii) For consideration other than cash, dealingsin all the shares of the company on The Exchange shall be suspended for such period as may be determined by the Council.”
In addition, please note that Clause 23 of the Amendments to the Listings Rules provides as follows:
23. Request for Suspension at the instance of The Issuer
23.1 Any request for suspension must be made to The Exchange in writing by the Issuer or the Issuer’s authorized representative or financial adviser and must be supported by the specific reasons which the issuer wishes The Exchange to take into account in The Exchange’s determination of whether or not trading in the issuer’s securities should be suspended.
23.2 The burden is on any Issuer that requests a suspension of trading in its securities to satisfy The Exchange that a suspension would be necessary.
However, the Amendments to the Listings Rules will not come into effect until1 November 2014.
