RNB properties Limited should be lauded for being the first local company to list its ordinary shares on the Maseru Securities Market (MSM), roughly five years after the revered body was established.
Dec. 10, 2021
2 min read
RNB Properties Ltd deserves a pad on the shoulder
- Listing marks a significant milestone in development of capital markets in Lesotho
- The move will prompt other local companies to follow suit in future
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On Monday this week, the Central Bank of Lesotho announced the property outfit’s decision to be the first in listing its ordinary shares on the main platform of MSM, which simply translates into the fact that all issued shares of the same class can now start trading on MSM, thus offering the existing investors an opportunity to sell their acquisition and the potential ones an opportunity to buy shares on the regular market where the company valuation and the price of its shares will be driven by market fundamentals.
The listing marks an important and significant milestone in the development of capital markets in the country, more specifically the development of equity market and the exchange.
This move is commendable because a lot of other companies in Lesotho are not particularly keen to follow the same direction for a number of reasons that include lack of willingness to be subjected to the corporate governance standards, among others.
With the stringent economic conditions in the country, dominated by lack of skills, industry related education and training as well as access to finance, listing could be a perfect platform for local companies to solve some of these problems.
Companies should see this as a perfect opportunity to raise the much-needed capital for their business expansion. In this way the struggling local private sector could also realise the much needed growth hence more opportunities and job reaction.
Of course the journey towards listing may be both vexing and tedious, but considering the benefits that come with it, companies should demonstrate passion and willingness to join the RNB Properties in doing the right thing.
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In many more years to come, the company will be remembered as the pioneer in this regard, opening doors for more investment opportunities in the long run.
On the other hand, staying private essentially means that a company’s shares are not traded on the public stock market. Shares are held by the company founders, their families or some selected group investors. If you want to buy shares in such a firm, you have to make a request to the existing owners.
Staying private also avoids burdensome disclosure requirements from stock exchanges and some companies fear that a small slip up due to perhaps lack of diligence could lead to troublesome interest from regulators, or even expulsion from a stock exchange.