Ashaka Cement removed from Nigerian Stock Exchange

Ashaka Cement Plc was on Tuesday delisted from the Nigerian Stock Exchange (NSE) .

Its shareholders, who had exercised their option to exit the company prior to the delisting, will receive 57 Lafarge Africa Plc shares for 202 Ashaka shares, as well as a N2.00 per share cash consideration.

Shareholders who do not want to remain in the unlisted Ashaka Cement will be entitled to receive a payment of N15.74 per share from the company.

The Board of Directors of Ashaka Cement Plc had opted for a voluntarily delisting of the company from the NSE in violation of the exchange’s Free Float Deficiency provision of 20 per cent.

Lafarge Africa Plc currently holds 84.97 per cent of Ashaka Cement, bringing the free float that is tradable on the NSE to 15.03 per cent as against 20 per cent stipulated by the exchange.

The directors explained that is not improbable that given this free float deficiency, the NSE could take enforcement action and initiate a regulatory delisting, given that the free float deficiency is not likely to be remedied, hence the decision to delist and operate as an unlisted company.

Besides, the free float deficiency, the directors said over the last five years, there has been little or no trading activity with only 0.20 per cent of the shares held by the minority shareholders being traded.

“Neither the company nor any shareholders are benefiting from the continued listing as shareholders are not getting any exit opportunity and their investments have been locked up and they find it difficult to dispose of their shareholding.

“Moreover, the company is bearing unnecessary cost in complying with its listing obligations,” Thisday quoted the directors.

Ashaka Cement recorded a decline of 27 per cent in profit after tax (PAT) for the year ended December 31, 2016.

The company posted a revenue of N17.351 billion, showing a marginal fall from N17.415 billion in 2015. Ashaka Cement ended the year with profit before tax of N2.663 billion, down from N3.209 billion in 2015, and PAT of 2.01 billion, compared with N2.76 billion in 2015.