Shareholders of Oando Plc are happy over the rise in the company’s share price by 26 per cent, following the lifting of a technical suspension placed on the company’s shares on October 23, 2017.
The Nigerian Stock Exchange (NSE) began free trading of Oando shares on the heels of a directive from the Security and Exchange Commision (SEC) on April 12. The share price has experienced a jump from N5.99 to N7.55 after only three days of trading on the floor of the Nigerian capital market.
Speaking on the development, Mr. Babatunde Badmus, Pacesetter Shareholder Association, said: “We are happy the SEC and the NSE has finally heeded to the pleas of minority shareholders like myself. It is unfortunate it took six months to take effect. Nonetheless, we are pleased to finally be allowed to reap from the company’s positive operations in the last six months.”
Oando’s minority shareholders have been the hardest hit since the imposition of the technical suspension. During the suspension, the NSE’s All-Share Index gained 14 per cent.
By virtue of the sustained suspension, Oando shareholders could not benefit from the positive sentiments in the market.
Should the shares have been freely tradable, a positive correlation between crude oil prices and the share price of Oando Plc would have afforded the over 270,000 shareholders an opportunity to profit from the inevitable price rally.
Mr. Tambari, an Oando shareholder with the Sokoto Zone Shareholders Association, said: “The lifting of the technical suspension is a breath of fresh air. Every true shareholder of Oando is delighted that we can finally reap a return on our investment. It is for this reason I doubt the authenticity of these shareholder groups, saying the suspension shouldn’t have been lifted. “Haven’t we suffered enough? The public knows that the company is viable, this is already evident in the price jump since the NSE began trading.”
Ms. Ayotola Jagun, the company’s Chief Compliance Officer and Company Secretary, in an interview with CNBC, said: “When the suspension was lifted, 178 million shares were on bid with only 5.5 million available for sale. The company’s share price hit the NSE daily price ceiling of 10 per cent by 10.45am; further evidence that there is a lot of interest in Oando shares and that the general mood around the market and our shares is positive.”
On the contrary, Proactive Shareholders Association of Nigeria (PROSAN), The Trusted Shareholders Association of Nigeria (TSAN) and the Oando Shareholders Solidarity Group (OSSG) differ in opinion on the removal of the technical suspension. They have termed Kemi Adeosun’s, Minister of Finance redeployment of Dr. Zubair as “A ploy by the Minister of Finance to sweep the weighty allegations against Oando under the carpet.”
Speaking on the controversy surrounding the lifting of the suspension, Patrick Ajudua, Oando’s shareholder with the New Dimension Shareholders Association said: “It is worrisome how the conversation has shifted from this good news, Oando shares trading on the capital market, to the call for the Minister of Finance to be sacked. Shareholders should be happy because we have lost out the most. This is a major hurdle that has been crossed and should be celebrated. “But instead troublesome and supposed Oando shareholders are not celebrating they are protesting this good news. Why would any shareholder do that? “Should they not be asking for the swift conclusion of this investigation so Oando can focus on generating a profit and dividend for us shareholders. My hope and that of the members of my association is that the SEC will conclude the forensic audit as soon as possible so that the company can focus on its business operations.”
For 176 days, shareholders and the capital market were held to ransom. The suspension of Oando shares, which experts argued should not have lasted this long, halted the company’s ability to contribute its quota to the NSE All-Share Index and denied shareholders the opportunity to benefit from its positive business operations.