Uncategorized

NSE plans to launch trading platform for SMEs

TradingThe Nairobi Securities Exchange has planned to start a trading board for small and medium enterprise (SMEs) on Tuesday, which will open a new investment window and funding opportunities for start-up businesses.

The establishment of the Growth Enterprise Market Segment (GEMS) will be the culmination of years of planning that is designed to accommodate SMEs at the stock market for the reason that they employ about 75 per cent of Kenyan workers.

The NSE chief executive, Mr. Peter Mwangi, revealed that three firms had already applied for listing on the GEMS board.

The financial advisory firm Burbidge Capital has already received NSE’s approval to act as consultant for small firms applying for listing on the GEMS board. The firm was of the opinion that there was immense interest among small firms that wish to use NSE as an alternative source of capital to traditional bank loans.

Vimal Parmar, head of research at Burbidge Capital said that they had been getting a lot of queries from firms, most of whom were interested in raising capital.

The firm is an authorised nominated advisor (Nomad) – a consultant for firms that want to be listed on the GEMS segment. Other licensed Nomads firms are Emerging Africa Capital, Standard and Mutual, and NIC Capital.

Mr. Parmar said that though a number of potential SMEs were interested in the platform, the first listing was likely to take place in the second quarter of the year as issuers would wait for the outcome of the General Election to implement their plans. There was a wait-and-see tendency as they waited for the elections.

Despite the pending elections, NSE has been on a bullish run. Mr Mwangi revealed that at least four other companies, including the stock exchange itself, intended to list on the main board this year.

The new market segment will give small firms a chance to grow by offering them flexible listing requirements such as the number of issued shares (100,000) and a minimum paid-up capital of KSh. 10 million.

Firms that were seeking to list on the alternative investment market segment (AIMS) were required to have a minimum capital base of KSh. 20 million while those that were applying for the main investment market segment (MIMS) were required to have a minimum paid-up capital of KSh. 100 million.

SMEs that exhibit high potential for growth need not show a proven profitability record but must still adhere to prudent management practices like having a board made up of qualified people.

One of the eligibility criteria for listing was that directors should not have had bankruptcy, fraud, criminal offence, or financial misconduct proceedings for two years.

Those firms who were seeking a listing on GEMS would also be required to have at least 35 per cent of their shareholding locally owned and 15 per cent free floating. A majority of the shareholders would also be forced into a two-year lock-in period.

Listing on GEMS will also give firms a window to unlock shareholder value while helping to reduce high financing costs related with traditional financiers such as banks, whose lending charges and collateral requirements often curb the growth potential of SMEs.

Image courtesy: FreeDigitalPhotos.net

Leave a Comment

Your email address will not be published.

You may also like

Growing a Business

Want Great Guidance ? Find yourself a Super Mentor

post-image

They are the gods of small businesses, those inspired individuals who have achieved the highest levels of success. They can be the shining beacons who light up the path of running your business with their vision, wisdom and wealth of resources and contacts. They are The Mentors.

If you are fired with the passion to take your business to great heights, the best thing to do is find yourself a super mentor. Here are some tips to help in your quest

Pinpoint your Need

Sit down and focus your thoughts on your business growth strategy. Which area of the business needs a lift. Is is staffing, is it the finances, is it the production, is it the your lack of customers or is it the business as a whole that needs a makeover. Once you’ve zoomed in on the sore spot, this is where you need…

Read More
Growing a Business

Dreaming Big? You can Move Mountains with these Business Productivty Tips

post-image

You may be full of admiration for some people who seem to manage themselves and their work so usefully and efficiently. They seem to fit in so much productive work into the same number of hours which everyone has.. Let’s look what makes them tick and take a few tips.

Learn to identify your most productive hours

Its true, most productive people know which time of the day they can be most creative and efficient. They identify and allot these hours for the best part of their work. This way they are able to give their 100% awareness to the job and business productivity.

Early to rise- A winning habit

Waking up early is a personal habit that has all the plusses on its side. You need not necessarily go to work that early. It’s a habit that gives you more time for personal care, like mediation, exercise, walking,…

Read More
Growing a Business

Leadership Qualities that can make you an Icon

post-image

You may have reached the leadership position through sheer dedication to performance and a do or die attitude . Now that you are at the top, your viewpoint needs to change. You have to now be a role model, one whom others will look up to and follow. Here are some tips that can shape your leadership and management skills

Be Competent: Employees will look up to a leader who has good industry knowledge and management skills. If you do not possess these skills you should surround yourself with knowledgeable people who can offer good counsel. Competence is a trait all employees will admire.

Be Trustworthy: No one will look up to a person they cannot trust. Your employees will want to rely on you and count on you. In difficult situations, leaders are expected to apprise their employees of the situations and find solutions on how to address…

Read More
Raising Money

Are You offering Your Services Using the Right Pricing Strategies?

post-image

In these times of fierce competition, business people , mostly those that offer services and belong to the service based industry, are finding it a challenge to implement the right pricing strategies. It is virtually a struggle to set the right business price that will retain and attract the customers, and not drive them away. Follow these tips, the crucial dos and don’t s and you may be in a much better position to offer your services at the best price.

Maintain your Business identity and Dignity

If you are offering a unique or special product or service, don’t underrate it just because you want to build a better relationship with the customer. This will just cheapen your offering as another run of the mill. If its something special you are offering the customer, then communicate this fact to the client and get the equation right with the most…

Read More
Raising Money

What is a Fair Wage? How Do you Assess Fair Wage?

post-image

How do you figure out a fair wage?

This is a very common question for startups and small businesses. They can’t seem to decide or understand how to set wages and manage reputations at a time. They are determined to pay well but they also have to think about encouraging their employees to stay with them for a long time. This is why there is a need to think strategically.

Listed below are a few expert tips to help you decide:

Don’t Focus Only on Money

Money should never be the main focus for you or for your employees. You should decide on the wages in such a way that your employees are tied to your business. When your business does well they should be able to taste that success and vice versa.

Also, think about additional perks such as exclusive benefits and time off. Many employees value this more than the overall…

Read More
Raising Money

Tips to Winning Hard Negotiations With Ease

post-image

While some negotiations are easy, others are quite hard to win. If you stumble you will lose.

Whether it is a potential client or an investor, negotiations can be very tough and frustrating. The problem is that the moment you let your frustration overwhelm you, you will lose the deal and you will give in to whatever is being offered to you. In order to avoid that, here are tips to overcome tough times and to win even the hard negotiations:

Research!

Know your opponent as well as possible. This is the rule no matter what you do. You should understand your opponent to the T. Who the person is, what his culture is, what he thinks, what he stands for, how is his network, etc. are the questions you should ask yourself and answer through research before meeting up for the negotiation. Understanding the opponent will give you a great advantage.

Walking…

Read More