NSE for Dummies: Listing your Company at the GEMS

NSEGEMS is the Growth Enterprises Market Segment at the Nairobi Securities Exchange Ltd. It is the latest segment to be introduced at the NSE to cater for high growth SMEs who would like tap into the large capital source through the stock market in Kenya. Currently there are three companies listed at the GEMS including:

  • Home Afrika Ltd
  • Kurwitu Ventures
  • Flame Tree Group Holdings Ltd

For those SMEs who might be contemplating listing at the NSE soon, here is the checklist for you:

Corporate and Capital

Incorporation Status:

  • A public company limited by shares and registered under the Companies Act

Share capital:

  • A minimum authorized and paid up ordinary share capital of Ksh. 10 million
  • The company should have at least 100,000 shares in issue

Free transferability of shares:

  • The shares should be freely transferable
  • The shares should not be subject to any restrictions on marketability or any pre-emptive rights

Working Capital and Solvency:

  • The company must be solvent with adequate working capital
  • Directors shall be required to give an opinion on working capital adequacy for at least 12 months following the listing

Time of operation and profitability:

  • The company ought to have been in operation for at least one year

 

Corporate and Governance

Competence Stability of directors and management:

  •  The directors and the senior management of the company must have the necessary expertise and experience to run the company

Number of directors:

  • A minimum of 5
  • One third of the directors should be non-executive
  • For at least two years prior to the date of application, no director should have been declared bankrupt, charged with fraud, criminal offences of financial misconduct

Directors Induction Programme (DIP) and NOMAD:

  • One third of the directors are required to have completed the DIP while the rest ae required to do the course within 6 months of listing the company.
  • The company must appoint a Nominated Advisor (NomAd) by contract and have one at all times while listed.

 

Post-Listing

Immobilization of shares and shares ownership structure:

  • At least 15% of the shares should be available for trade by public within 3 months of listing (excluding those held by a controlling shareholder or Company’s senior management)

Retention of management and controlling shareholders:

  • The company must ensure retention of qualified management during listing and keep the same for 12 months following the listing
  • Controlling shareholders are restricted on the sale of their shareholding over a 24 months period on a tiered schedule

Download the listing guide from here NSE

 

 

 

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