Shareholders of Newrest ASL, have mandated the management of the company to proceed with their plan to voluntarily delist from the Daily Official List and from the Main Board of the Nigerian Stock Exchange(NSE). The authorisation was given at the Extraordinary General Meeting (EGM) of the firm which was fuly convened and held on January 29, 2019 at the Golden Tulip Hotel, Amuwo Odofin, Lagos State.
“Pusuant to the recommendation of the Board of Directors of the company dated 18th December 2018, consent hereby accorded to the Board , by the members of the company, to seek voluntary delisting of all the shares of the company from the Daily Official List and from the Main Board of the Nigerian Stock Exchange where the shares of the company are currently listed, subject to the listing rules of the Nigerian Stock Exchange and all other applicable laws.
“ The board be, and is hereby authorised to do all such acts, deeds, matters , and delegations that may be required for giving effects to the above resolution”, a statement signed by LPC Solicitors, the company’s secretary, said.
By the time this decision is implemented, Newrest ASL will become the 100th company to get delisted from the NSE since 2002.
In 2002, two firms, Imprest Bakolori and Dumez Nigeria, delisted their shares from the NSE. CFAO Nigeria was the only firm which delsited ist shares voluntarily in 2007. In 2008, a total of 19 firms delisted their shares from the Daily Official List of the NSE. Notable amongst them were Sun Insurance Plc,Intra Motors, Atlas Nigeria, Enpee and Tate Industries, among others.
In 2009, a total of 11 companies were delisted from the NSE while only two firms got their shares delisted from the NSE in 2010. Twenty-one (21) firms delisted their shares from the NSE in 2011, and that was the year the highest number of firms got delisted in a financial year. Three (3) firms were delisted in 2012, while 4 were delisted in 2013.
In 2014, six firms were equally delisted from the NSE; 4 firms in 2015, and 15 in 2016. In addition, six companies got their shares delisted in 2017 and four in 2018 . On January 25, 2019, Great Nigeria Insurance had its shares delisted from the main board of the Nigerian Stock Exchange to be the 99th firm to be delisted since 2002.
When analysed by reasons for delisting from the NSE, 70 firms were delisted by regulatory mandate, either by the Nigerian Stock Exchange or the National Insurance Commission (NAICOM). Nineteen firm got delisted voluntarily, four were nationalised by the Central bank of Nigeria (CBN) while others were delisted through merger and aqcquisitions.
Analysts have adduced different reasons as to why companies may want to delist their shares from the NSE, such fulfilling the strategic plans and objectives of it founders and their inability to fulfil post listing rules.
“ The choice to list or delist is a strategic decision that is embedded in a company’s phylosophy and growth plan. Whilist ASL may have been listed to drive growth through increased access to capital and enhanced governance, the major shareholders may have fulfiled these objectives. Moreso, the region makers in ASL may have a change in strategy and such strategic shift may be best suited by taking the company private, said Abiola Rasak, head, investor’s relations, the United Bank for Africa (UBA).
“ Most of those companies are closely held with little float. There is therefore no incentive or business as imperative as to stay public”, said Kemi Akinde, senior analyst with Meristem Securities.
Unaudited nine months results ended September 30, 2018 indicated that total revenue increased by 42 percent from N2.83 billion in 2017 to N4.03 billion in September 2018. Other income rose by 136 percent from N281.5 million to N663.6 million. Finance income from continuining operations rose by 478 percent to N1.09 billion up from N189.4 million in corresponding period in 2017. Profit after tax from continuing and discontinued operations increased by 296 percent to N1.09 billion from N276.8 million in corresponding period in 2017.
Incorpoared on June 12, 1996, Newrest ASL started its operations as Air Services and Logistics Plc, it got listed on the main board of the Nigerian Stock Exchange (NSE) on July 25, 2007. The company is into flight catering, running of restaurants in airport lounges and other outlets. At a board meeting held on November 19, 2015, the board of the company recommended to the shareholders for approval the change of the company’s name from Airline Services and Logistics Plc to Newest ASL Plc. At a cuurent market price of N6.45 per share, Newrest ASL has 634 million shares outstanding as at February 1, 2019.
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