Business Nigeria's IPO Market Will Become Active in 2015- Financial Experts



The Nigerian IPO market since 2008 has seen less action year after year because most companies preferred rights issues and bonds. However business experts have predicted a major boost for the sector come next year. So, it's a good advice to start saving up in preparation, an extra buck on the side won't do anyone any harm.

Excerpt from ThisDay:

IPOs are made by companies issuing their shares to members of the public for the first time to raise fresh funds. IPOs were very common in 2007 and 2008 before the market witnessed a downturn. Since 2008, companies have been avoiding IPOs, embracing mostly rights issues and bonds.

“It (IPO) is a question of time. The driving force for capital raising, not just Nigeria but across Africa now is debt. Companies are inherently underleveraged in Nigeria so we are going to see more debt issuance before you see equity issuance. Companies have to come because the balance between the interest of the investors and the company moving forward. So we expect more of IPOs taking off from the second half of next year,” Adebayo said.

A stockbroker, Mr. Ayo Oguntayo, said the return of retail investors would encourage companies to issue IPOs in the very near future, hence the expectation that the market will become active in 2015 is not misplaced.

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