Champion Breweries Secures N60 Billion to Meet NGX Free Float Rules
Champion Breweries Plc has met the Nigerian Exchange (NGX) minimum free float requirement after a major capital raise. The company completed a N60 billion funding round to address its earlier deficiency on NGX RegCo's X-Compliance Report.
This move strengthens its financial position and supports future expansion plans.
The Nigerian Exchange requires Main Board companies to maintain a free float of at least 20% of issued shares or a minimum value of N20 billion. Champion Breweries fell short of this threshold before its latest capital raise.
To resolve the issue, the company launched a N60 billion funding initiative. This included a N15.9 billion Rights Issue and a N42 billion Public Offer. Both components received approval from the Securities and Exchange Commission (SEC) and are now in the final stages of crediting to Central Securities Clearing System (CSCS) accounts.
The successful capital raise not only meets NGX's free float rules but also bolsters the brewery's balance sheet. As a result, the Below Listing Standard (BLS) Compliance Status Indicator will be removed from NGX platforms. This change reflects the company's improved compliance and market standing.
Adequate free float ensures better liquidity and smoother trading of securities on the exchange. Growth Board companies follow different free float rules, but Main Board firms like Champion Breweries must adhere to stricter standards.
Champion Breweries has now satisfied NGX's free float requirement, removing its compliance warning. The N60 billion capital injection will fund strategic growth while improving financial stability. The company's shares are expected to trade more freely on the exchange following this adjustment.
