By Nse Anthony-Uko
Promoters of the proposed Commodity and Futures Exchange under the aegis of the Association of Stockbroking Houses of Nigeria (ASHON) have endorsed the N500 million private placement capital raising option to flag off its operation.
Besides, the elated members are demanding for more information to enhance their investment decision on the laudable project designed to key into the federal government’s diversification programme with special emphasis on agriculture.
Speaking at the end of a closed door breakfast meeting hosted by ASHON for the chief executive officers of Stockbroking Firms on Tuesday, a senior Stockbroker and former president, Chartered Institute of Bankers of Nigeria (CIBN), Mr Okechukwu Unegbu commended ASHON for the initiative.
According to him, stockbroking firms should take advantage of the right of first refusal to invest in the project because it has potential for good returns. He noted that the fund raising Memorandum contained vital information that can help any investor that intends to participate in the project . He explained that government had begun to build many shilos to boost trading in commodity products as part of the diversification programme.
Corroborating Unegbu, the chairman of ASHON, Mr Patrick Ezeagu explained that the rationale for the meeting was to lay open every necessary fact that would enable them to participate in the private placement.
“We had in conjunction with our Financial Advisers, Consultants, Auditors, Accountants, etc been working tirelessly to put together the Strategic Business Plan and Information Memorandum for the Lagos Commodity and Futures Exchange ( LCFE) that we the investors, can rely upon to make an informed investment decision,” he said.
Vice chairman of ASHON, Mr. Akin Akeredolu-Ale informed the participants that in order to ensure a seamless take-off of the Exchange, the Association hired different consultants to confirm the depth of the market in terms of absorptive capacity for commodity and futures trading and models to run the Exchange in terms of strategy and the structure of the board when constituted to ensure compliance with Corporate Governance requirements.
Representative of Meristem Securities Limited, Mrs Adejumoke Awolumate assured the participants that the Placement Memorandum has shed light on the critical areas of investment decision on the project.
According to the Memorandum of the Private Placement, 500 million ordinary shares at N1 per Unit would be offered. The proceeds will be applied to fund the start-up and operational take-off costs, administrative and personnel costs of the LCFE and leasing of a trading Platform to the trading of qualifying derivatives, including options, futures and spots among others.