Investors begin conditional trading of Seplat shares on LSE

Ahead of its formal admission and ‘unconditional’ trading next week (April 14) in London, equity traders yesterday commenced ‘conditional’ trading of Seplat Petroleum Development Company’s shares on the Main Market of the London Stock Exchange (LSE), BusinessDay has learnt.

Seplat’s global offer raised $500 million, giving it a market capitalisation of $1.91 billion. With this development, Seplat is now the sixth oil and gas explorer with significant operations in Nigeria on London’s markets.

After formal admission next week, the company will be the first Nigeria-registered company to list its shares on London’s Main Market.

“We are delighted to welcome Seplat to London. The successful completion of its simultaneous IPO in London and Lagos is a demonstration of how London Stock Exchange and the Nigerian Stock Exchange can complement each other in financing Nigerian industry and infrastructure,” said Ibukun Adebayo, head of primary markets for Africa, London Stock Exchange.

“A London listing ensures that Nigerian companies have access to the world’s largest pool of international equity capital and to the world’s marquee investors, while a Nigerian listing ensures that all available domestic funds are tapped and Nigerian citizens are provided the opportunity to participate in the wealth that is created by the development of the country’s natural resources,” he further said.

Conditional trading is a period of conditional dealing with deferred settlement. It typically takes place in securities which are due to be listed or admitted to trading on one of the Exchange’s markets. Trades during the conditional trading are conditional on the security being listed or admitted to trading and can only settle once trading has become unconditional. Where the security is not listed or admitted to trading, all transactions effected during the period of conditional trading are void.

Overall, there are nine Nigerian or Nigeria-focused companies on London’s markets. Three of them are banks that have listed Global Depository Receipts (GDRs) in London (GTBank plc, Diamond Bank plc, and Zenith Bank plc). Also, there is one other upstream explorer and producer with Nigerian operations on the London Stock Exchange Main Market (that is, Afren). And there are four oil and gas explorers on AIM, London’s junior market (Sirius, SacOil, Eland and Lekoil).

The London Stock Exchange says it is the largest international stock exchange for African companies, adding, “Since 2008, Africa-focused companies listed on London Stock Exchange have raised over $9.5 billion in new and further issues.”

115 sub-Saharan Africa-focused companies are listed on or admitted to London Stock Exchange markets, comprising 26 equity listings on the Main Market; 3 GDR listings on the Main Market; 2 GDR listings on the Professional Securities Market (PSM); and 84 equity admissions on AIM, the growth market.

Iheanyi Nwachukwu