NASD targets N12 billion in rights issue to fund technology push, market expansion

The National Association of Securities Dealers (NASD), Nigeria's over-the-counter securities exchange, has initiated a N12 billion rights issue aimed at bolstering its capital base and facilitating its transition into a composite exchange. NASD Chairman Kenechi Ezezika revealed the strategic purpose behind the recapitalization, emphasizing its significance in the Exchange's evolution.

The rights offer includes 480 million ordinary shares priced at N25 each, with shareholders eligible to receive four new shares for every five shares they hold at the qualification date. Upon full subscription, the offer would generate N12 billion in gross proceeds, enabling NASD to invest in technology, infrastructure, talent, and market-development projects.

Ezezika highlighted that the capital raise would provide the necessary resources for NASD's forthcoming growth phase, as market expectations regarding efficiency, transparency, and technology continue to evolve. The N12 billion rights issue is projected to produce net proceeds of approximately N11.724 billion after accounting for estimated transaction costs of N275.875 million.

NASD has devised a three-part plan for allocating the funds, contingent on regulatory approval. The offer is slated to commence on Monday, with the Group Managing Director of Anchoria Capital Group, Sam Chidoka, pledging his firm's commitment to ensuring a seamless process and widespread shareholder participation. Managing Director of Anchoria Advisory, Damilola Titiladunola, confirmed the Monday opening date pending final regulatory clearance.

If the rights issue is fully subscribed, NASD's issued shares would rise from 600 million to 1.08 billion ordinary shares. Existing shareholders would have the opportunity to preserve their proportional ownership through the four-for-five rights issue, while the expanded share base would raise the number of shares in issue by 80%.