Some shareholders have threatened to drag the Nigerian Stock Exchange Limited to court over a notice issued to hold its annual general meeting, to raise additional N35bn through hybrid offering of equity and debt among other issues.
A letter titled, ‘Re: Notice of 61” Annual General Meeting of NGX Exchange Group Plc’ by solicitors to Mr Olayinka Olajuwon and Bamidele lbironke, who represented the shareholders,described the notice as “fraudulent, ill-advised” and abuse of office by the directors of the board.
The shareholders claimed that the resolution was in contrary to Section 142 (2) of the Companies and Allied Matters Act 2020, insisting that the law guiding the Exchange Limited does not give its Board of Directors any right to alot share.
While scathing the decision of the Board for the offerings, the shareholders said “It is unthinkable how incurring a debt burden of N15bn for the company will translate to raising capital for the company that remains a viable, highly regarded entity in the capital market with unissued shares,” thus declaring the notice as “egregious abuse of privilege by the board of directors.”
The shareholders further said the board’s decision contradicted Section 340 of SEC regulations, which provides guidelines for companies that wish to offer securities.
They added that the company had breeched both the SEC’s regulations and CAMA Act.
The NGX, in a statement said, “Nigerian Exchange Group Plc (and its subsidiaries) is and remains committed to the highest level of corporate governance with the overriding interest of maximising value for its shareholders.”