In a move to increase the liquidity in the shares of Ellah Lakes Plc, the three major shareholders of the company have undertaken to sell down 25 percent of their shares in Ellah Lakes on or before March 15.
The decision which is towards resolving the free float deficiency of Ellah Lakes Plc is in line with their discussion with the Nigerian Stock Exchange (NSE) due to the company’s free float that stands at 14.55percent with a value of N1.23billion.
Free float, also known as public float, refers to the shares of a company that can be publicly traded and are not restricted (that is held by insiders. In other words, the term is used to describe the number of shares that is available to the public for trading in the secondary market.)
The NSE regulation requires that companies listed on the Main Board must maintain a minimum free float of 20 percent or free float valued at N20billion.
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Following the completion of Telluria in 2019, majority of the shares of Ellah Lakes Plc were consolidated and free float was reduced to 13 percent, below the regulatory threshold.
In a bid to rectify this situation, CBO Capital Partners, Blackman & Co, and Osaro Oyegun have given an undertaking with the intent of bringing the company into compliance with the 20percent free float requirements of the NSE.
Chuka Mordi, CEO, Ellah Lakes Plc said, “We fully appreciate why we need to have more shares in the hands of the public, which is why we are listed on the Nigerian Stock Exchange.”
“We are working towards compliance and we fully expect that we can achieve this by the deadline of March 15, so as to galvanize and encourage liquidity in the shares of Ellah Lakes Plc”, he added.
