FG plans to sell Abuja Commodity Exchange this year

By naijanewsnow

 

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The Federal Government plans to sell its ownership of the Abuja Securities and Commodities Exchange by the middle of the year, according to Bloomberg.

'The government wants to privatise the only commodity exchange and it had committed to doing it by the end of last year. It didn't meet that deadline, but it's planning to do something by the middle of 2014,' the Director General of the Securities and Exchange Commission (SEC) was quoted as saying.

Companies Heirs Holdings Limited, a Lagos-based investor with interests across Africa in banking, energy, real estate and agriculture, have shown interest in acquiring or setting up a commodities exchange in the country.

The Chairman, Heirs Holdings, Mr. Tony Elumelu, had said he wants to acquire the state-owned Abuja-based exchange when it is sold. If it's unable to buy the exchange, Heirs Holdings would apply to the SEC to set one up, he had added.

The company, through its African Exchange Holdings Limited unit, has stakes in Kigali, Rwanda-based and Lagos-based National Association of Securities Dealers trading platform. In collaboration with the Nigerian Grain Reserve Agency and the Agriculture Ministry, Heirs Holdings in November established an electronic warehousing system linking farmers and traders as part of the groundwork to set up a commodities exchange.

'We have a number of both domestic players and international players who are very interested,' Oteh said.

'They'd rather acquire the privatised exchange, so they're trying to see how far the government is going with this initiative and if not they're prepared to seek a registration for a new commodity exchange,” she added.

Good cocoa harvest last year further highlighted the importance of such an exchange. Nigeria had Africa's third-biggest cocoa harvest last year and produces crops such as cotton and sugar.

The Abuja Commodity Exchange opened in 2001 initially an equities exchange but was converted from a stock exchange to a commodities market in 2001, following opposition by promoters of the Nigerian Stock Exchange, who felt that Nigeria was not ripe for two stock exchanges.