Securities issuance: SEC rolls out regulations for private companies

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The Securities and Exchange Commission (SEC Nigeria) yesterday unveiled new regulations governing the issuance and allotment of securities by private companies, limiting the maximum to N15 billion annually.

The Securities and Exchange Commission yesterday unveiled new regulations governing the issuance and allotment of securities by private companies, limiting the maximum to N15 billion annually.

It explained that for a private company to be eligible to issue securities under the regulations it must be a company duly incorporated under Companies and Allied Matters Act , or other enabling Laws with at least three years track record of operation. a) Only plain vanilla bonds/debentures and other debt instruments including sukuk and as may be determined by the Commission from time to time, shall be issued. b) For sukuk issuances, the issuer shall comply with the provisions on sukuk and set out in Rules 569 – 588 of the Commission’s Rules, as amended from time to time.

It added that a private company “shall not offer its equity securities to the public under any circumstance. b) Debt securities issued under these rules, shall be sold only to qualified investors. c) Only registered capital market operators shall be parties to debt securities issuances under these rules.

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