NGX To Amend Rules To Woo Tech Firms

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Better times ahead for players in the Tech space in Nigeria as Nigerian Exchange Group has made it known that there may be a possible restructuring of the rules guiding company listing on the exchange in a bid to attract more initial public offerings from Tech companies in the country due to their high valuation.

More than 5 Nigerian Tech companies have raised funds from foreign venture capital firms that has made them worth over $1billion and become unicorns in the process; some of these companies are Interswitch, Jumia, Opay, Andela among others in the past 2 years.

Hence, the NGX inaugurated the Technovation conference to engage the blooming tech sector and its major players. Olumide Bolumole, Divisional Head of Listings at NGX, during the Q&A session at the event, stated that, to enhance capital formation for tech firms and encourage them to list on the exchange, they were looking to tweak some rules that could form potential hindrances to the companies. He said many of the listing rules required companies to be profitable for listing, but since tech firms were largely in their early stages, a requirement for profitability would be a major hindrance to them.

“That is something we are critically looking at and seeing if we can find another way of achieving that same metric or even doing away with it completely, especially, if the buy side does not care for that.

“The other area that we have seen is on corporate governance rules which may require some modifications. “We are very intentional with having conversations about seeing how we can tweak things for tech companies.

“Financial reporting is another one. We have quarterly financial reports that International Financial Reporting Standards state, and there are many good reasons it exists that way.

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The Exchange will also participate in the startup bill by sharing its input to make the bill become more encompassing especially for the tech players in the country.