SEC to commence E-IPOs for Nigerian capital market in 2019

The Securities and Exchange Commission (SEC), on Thursday said that issuance of electronic Initial Public Offering (IPO) would begin in the Nigerian capital market in 2019.

Henry Rowlands, SEC Acting Executive Commissioner Corporate Services made this known at the SEC Journalists Academy in Uyo with the theme : “The Capital Market Master plan: The journey so far’’.

He added that turnover of mobile transactions in most exchanges had increased by 130 per cent in the past one year.

Rowlands stated that the figure could double in the next two years as far as smart phones were selling, adding that Nigeria must move forward with its contemporaries in technology in order to compete effectively.

According to him, preparatory process toward full automation of initial public offering (IPO) and other public primary offers in the Nigerian market is in top gear.

He said that a special-purpose committee inaugurated for the full automation of the primary issuance process had gone far to ensure commencement of E-IPO.

Rowland said that the committee comprised SEC, the Nigeria Stock Exchange (NSE), Association of Issuing Houses of Nigeria (AIHN), and the Association of Stockbroking Houses of Nigeria (ASHON).

Others are the Central Securities and Clearing System (CSCS), Institute of Capital Market Registrars (ICMR) and Capital market Solicitor Association (CMSA), among others.

Rowlands said that the full automation of primary issuance would involve automation of the process, approval, documentation, subscription and allotment of all issues, especially IPOs and public offers.

He noted that the initiative would enable investors to subscribe and make payment for IPOs and public offers online with such orders being matched and allotted electronically and directly to the investment accounts of the investors in CSCS.

Speaking on the topic: “Why digitisation is critical for our market- Case study: Dematerialisation, e-dividend and Direct Cash Settlement’’, he said that the commission would remain committed to operational efficiency.

Rowlands said that the Nigerian capital market must be competitive with the global trends and market for enhanced growth and development.

He said that technology and digitisation would drive the next space of global economy growth.

“The next phase of capital market growth will be driven by digitisation,’’ Rowlands said.

The  IPO is the selling of securities to the public in the primary market.

It is when an unlisted company makes either a fresh issue of securities or an offer for sale of its existing securities or both for the first time to public.