VENTURES AFRICA- Poly Products Plc has revealed plans to delist its shares from the stock market due to the pressure of maintaining the high cost of retaining listed equity status at the Nigerian Stock Exchange. The company’s chairman, Michael Bruce, revealed this during the company’s 45th Annual General Meeting with shareholders, in Lagos.
Poly Products Plc is however waiting for the approval of its shareholders before tendering its application for the delisting to the NSE and Securities and Exchange Commission (SEC).
Bruce explained that apart from the high cost of retaining listed equity status at the NSE, the company is faced with the lingering economic depression in the country as well as excessive cost of printing and distributing annual reports and accounts to its over 11,000 shareholders.
“Various factors, including the general slowdown in the economy, high cost of doing business, statutory requirements of listed companies, cost of administering the register, cost of convening AGMs and Annual Reports & Accounts printing and postage pose difficulties for the company,” Bruce said.
“There are 11,000 shareholders, 10,246 of whom hold less than 10 per cent of the total equity. The administrative cost of managing such list is very high and it constitutes a significant drain on the resources of the company,” he added.
However, a shareholders present at the meeting, Timothy Adesiyan , said that the move to delist from the stock market was expected given the fact that the company’s shares has been dormant for three years. He implored the management to put investor’s money into consideration before working out an exit package for them.
But the company’s chairman has assured the shareholders that the company has not set the exit price. He explained that there are certain guidelines to follow.
“The price must not be less than the value of the shares on the floor of the NSE in the last three months. The Nigerian Stock Exchange will be working with us in this regard to ensure that every stakeholder is fairly treated,” he revealed.
Meanwhile, Sir Sunny Nwosu, the National Coordinator, Independent Shareholders Association of Nigeria, encouraged the company to consider exit package of N5.00, according to general demand by shareholders.
Poly Products Plc had earlier been suspended for their failure to submit their financial statements for the year ended, March 2011.