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UPDC Plc risks suspension over default on NGX’s free float requirements

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Trading in the securities of UACN Property Development Company (UPDC) risks been suspended on the platform of the Nigerian Exchange Limited (NGX) due to the inability of the company to comply with the Free Float Rules of The Exchange.

According to a notice sent to the NGX today, the company fell below the free float requirements of 20% of issued share capital or N20 billion free float for companies listed on the Exchange’s Main Board, due to its recent Mandatory Take Over (MTO) by Custodian Investment Plc.

Recall that Custodian Investment Plc had obtained regulatory clearance to take over UPDC Plc, following the acquisition of a 51% majority stake in the latter, translating to about 34,415,332 units of ordinary shares, purchased at 90 kobo each.

Sequel to the acquisition, UPDC fell below the free float requirements for listed stocks at the NGX. This prompted a series of consultations between the firm and the NGX Regulation Limited (NGX RegCo).

Consequently, a unanimous decision to grant the company a two (2) year grace period till 10th of August, 2023, in order to comply with NGX’s free float requirements was reached. However, the Exchange warned that it might suspend further trading in the company’s securities if compliance with the free float rules is not achieved within the two (2) years grace period.

In addition, the company in conjunction with the majority shareholder reiterated its commitment to achieving the free float requirement within the grace period.

UPDC Plc closed trading today 20th of August, 2021 with a share price of N1.32.

 

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