CHAPTER TWO

THEORETICAL, LEGAL AND REGULATORY FRAMEWORK FOR MERGERS AND

ACQUISITIONS IN NIGERIA.

2.1. Introduction:

This chapter will capitalize on the existing foundation to explore the definitions of mergers and

acquisitions and the theoretical framework for mergers and acquisitions as business phenomena.

This chapter will also reflect on the distinction between mergers and acquisitions, the types of

mergers and acquisitions and the rationale behind merger and acquisition transactions.

Consequently, the current regulation of mergers and acquisitions will be discussed under two

arms; the legal framework and the regulatory agencies.

2.2. Definitions of Mergers and Acquisitions

Akamiokhor1 defines a merger as a combination or fusion of two or more formerly independent

units into one organization with a common ownership and management.

A merger can also be defined as the fusion of two or more companies in which one of the

combining companies legally exist and the surviving company continues to operate in its original

name. Osamwonyi2 defines a merger as the pooling together of the resource of two or more

corporate bodies resulting in one surviving company while the other is absorbed and ceases to

exist as a legal entity or remains a subsidiary if it survives.

1
Akamiokhor GA, ‘Mergers and Acquisitions’ The Nigerian Banker (1995) September-October, Cited In John
Udoidem and Ikechukwu Acha (n 17) 136.
2
Osamwonyi O, ’Mergers and Acquisitions: The Anatomy and the Nigerian Case’ in Ezejelue A.C and Okoye A.E
(eds), Accounting: The Nigerian Perspective (Nigerian Accounting Association: 2002), quoted in
Nwude’s3 definition of a merger is the amalgamation of two or more separately existing

companies to form a new single company. The new single company will inherit the assets and

liabilities of the separately existing companies which are then wound up. A merger can also be

seen as a combination of two or more corporations in which only one survives and the merged

corporation goes out of existence.

These definitions tend to suggest that when a merger between two companies occur, one of the

merging companies must lose their identity (assets and management), in favor of the other

merging company. It follows from the definitions of Osamwonyi, Nwude and Sherman and Hart,

that there is always a dominant company in a merger that swallows up the identity of the other

company or companies as the case may be.

Another view as to the nature of mergers in line with Sudarsanam’s is that a merger can be

described as a situation where two or more companies of approximately equal size come together

(with the shareholders and directors of both) all of which support the combination and continuing

to have an interest in the combined business4.

This view tends to suggest that a merger takes place on friendly terms between the companies.

According to the definitions, both the companies come together to form either an entirely new

company or the surviving company retains the interest of both of the merged companies

especially in terms of shareholding.

One of the reasons for this dichotomy in the conceptualization of mergers is the fact that mergers

can take different forms depending on the needs or interests of the companies.

3
Nwude CE, Basic Principles of Financial Management (1st edn, Enugu: Chuke Nwabude Publishers)
4
Balogun B, ‘Tax consideration for Mergers and Acquisitions’ (unpublished) paper presented at the workshop on
mergers and acquisitions organized by the Nigerian Insurance Association on Tuesday 14 December 1999)
An acquisition on the other hand is a more definite term which basically implies the purchase of

one company by another with neither the shareholders nor the directors of the purchased

company retaining any continuing interest in the enlarged company5.

Umunnehila6 described an acquisition as a business combination in which the ownership and

management of independently operating companies are brought under the leadership of a single

management.

Akamiokhor also defines an acquisition a business combination in which ownership and

management of independently operating enterprises are brought under the control of a single

management7.

An acquisition can simply be defined as the purchase of one organization by another. An

acquisition can be effected either by a Hostile Bid or a Friendly Bid 8. It is friendly when the

management of the acquiring firm and the target firm work out suitable terms that are agreed to

by both firms. The company that makes the friendly take-over offer to the target company is

referred to as “yellow Knight”. An acquisition on the other hand becomes hostile when the bid is

such that the target firm resists. Here the company which makes the hostile take-over offer on the

target company is called the “black knight”.

5
Popoola MA, ‘Mergers and Acquisitions- Tax Implications’ (unpublished) paper presented at the Annual CTN Tax
Conference, May 2005.
6
Umunnehila A, Corporate Restructuring in Nigeria (Lagos: Foundation Publishers 2001) quoted in
7
Akamiokhor, ‘Mergers and Acquisitions: The Nigerian Perspective’ (Seminar on the Perspectives on Mergers and
Acquisitions held 11 August 1989).
8
John Udoidem and Ikechukwu Acha, ‘Corporate Restructuring Through Mergers and Acquisitions’ [2013] (3)
Journal of Economics and Sustainable Development <https://www.researchgate.net/publication/305721357>
Jenson and Fama9 defines an acquisition as an act of acquiring effective control over the assets or

management of a company by another company without any combination of businesses or

companies. In acquisitions, two or more companies may remain separate independent legal

entities but there may be a change in the control of the companies. An acquirer may be a

company or persons targeting to hold substantial quantity of shares or voting rights of the Target

Company or gaining control over the target company.

In an acquisition, one company takes a controlling ownership interest in another firm, a legal

subsidiary of another firm, or selected assets of another firm such as a manufacturing. In other

words, an acquisition is the purchase an asset such as a plant, a division or even an entire

company10.

We have reviewed definitions of mergers and acquisitions given by various learned authors and

writers. We would now focus our attention on the statutory definitions of mergers and

acquisitions (M&A’s) under Nigerian law.

The Federal Competition and Consumer Protection Act (FCCPA) 2018, defines a merger as any

amalgamation of the undertakings or any part of the undertakings of two or more companies or

the undertaking or part of the undertakings of one or more companies and one or more bodies

corporate. The act did not go further to define the meaning of an amalgamation or specify the

undertakings of the company referred to in this context. The act did not also define what an

acquisition is but stated in section 92 (2) that a merger contemplated under (1) of the Act could

be carried out through the purchase or lease of the shares, interests or assets of the other

9
Jenson MC and Fama EF, ‘Separation of Ownership and Control in Management of Non-profit Organizations
<www.hbs.edu/faculty/pages/item.aspx?num=6602cached> cited by John Udoidem and Ikechukwu Ache (n 17)
136.
10
Rima Tamosiuniene and Egle Duksaite, ‘Importance of Mergers and Acquisitions in Today’s Economy’ [2009]
https://www.semanticscholar.com accessed 20 March 2021.
company in question. This means essentially under the act, acquisitions are taken as a format in

which mergers of companies can take place.

Rule 421 of the Securities and Exchange Commission Rules (SEC Rules) defines an acquisition

as the takeover by one company of sufficient shares or assets in another company to give the

acquiring company control over the company11.

2.3. Theoretical Framework of Mergers and Acquisitions

Certain theories have developed overtime in a bid to capture some essential reasons why one

company merges with or acquires the other. These theories go a long way in also explaining the

form with which a business transaction will take place, whether the firm would be prone to

merging with another or being acquired by another more successful firm.

2.3.1 Value Maximizing or Increasing Theory

The theory originates in the view that mergers and acquisitions (M&A) is an activity that may

generate a valuable asset i.e. when a company engages in M&A transactions, it adds more value

to the overall value of the firm. Under this theory, the managers of the firm have the primary

goal of maximizing shareholder wealth and a merger or acquisition should generate a positive a

positive economic gain to the merging firms or at least non negative returns12.

This theory basically views mergers and acquisitions as value maximizing activities and if this

objective cannot be achieved by the proposed transaction, the managers of the firms can reject

such proposal. The value increasing theories of mergers and acquisitions include the market

11
This provision has been deleted by virtue of the New Rule and Sundry Amendments to the Regulations of the
Commission (Securities and Exchange Commission) release 21 August 2019.
12
Agus Sugarito, ‘The Effect of Mergers and Acquisitions on Shareholders Returns’ (Dissertation, Victoria University
of Technology).
power theory and the efficiency theory13. According to the market power theory, increased

synergies is said to offer the firm positive and significant benefits because firms with the greater

market power charge higher prices and earn greater margins. The theory of efficiency on the

other hand purposes that mergers will only occur when they are expected to generate sufficient

realizable synergies to make the deal beneficial to both the parties. This theory predicts value

creation with positive returns to both the acquirer and the target.

2.3.2. Non Value Maximizing or Value Neutral Theory

This theory as proposed by Halpern14 takes the view that any merger or acquisition has no

economic gains for the company, and bidding firms are not interested in the profitability of a

merger. He opines that it is not necessary for managers of the firms who engage in the merger or

acquisition to display positive returns for shareholders. Instead, the merging firms, especially the

acquiring ones will seek some other objectives beyond the positive economic gains of their

firms, such as maximization of sales growth among others which may not be possible without a

merger or acquisition due to government regulations.

Most non value maximizing mergers are horizontal mergers because they sometimes create

monopoly and oligopoly. This leads to the intervention of governments i.e. the creation of anti-

trust agencies for the protection of public interests against an increase in the use of market power

in setting prices.

2.3.3. Managerial Hypothesis

personal interests. Under this hypothesis, managers conduct mergers and acquisitions if they

contribute to their personal wealth. Another name given to this hypothesis is an anti takeover

theory, because managers act to maximize their own utility.

2.3.4. Inefficient Managerial Hypothesis

Mergers and acquisitions can also be viewed as responses to inefficient management responses,

which make the firm an acquisition target. Inefficient management can be identified by several

indicators, for example poor earnings, undervalued shares and low P/E ratio16. If the firm is

acquired, the bidding firm will employ a new management team who will manage resources

more efficiently. The new management could choose to change the organization structure so that

it can be able to guarantee rapid responses to problems which arise.

2.4. Types of Mergers and Acquisitions:

2.4.1. Horizontal Mergers:

A merger is horizontal if it involves the combination of two or more companies offering the

same products or services. These firms are usually in direct competition with each other in fields

of product lines and markets. The rationale behind this type of M&A transaction could be the

15
Mueller D, ‘Mergers: Causes, Effects and Policies’ [1989] (7) International Journal of Industrial Organisation, 1-10
quoted in Sugarito (n 12) 13.
16
Price-Earnings Ratio which is the measure of the price of a company’s shares relative to the annual income
earned by the firm per share. A low P/E ratio will usually imply that the company’s stocks are undervalued.
reduction of competition and the greater likelihood of achieving economies of scale through the

elimination of facility duplication17.

A dominant rationale of horizontal mergers and acquisitions is eradication of major competition

in the market and the merged company or the acquirer enjoys monopoly in the market, and the

new firm could easily manipulate the prices, for which case Federal laws protect the companies

from creating a monopoly18.

2.4.2. Vertical mergers:

This occurs where two or more distinct enterprises engaged in the same market but operating at

different levels of the market combine. In vertical mergers, competitive effects depend on the

structure of the upstream and downstream markets19. The major concern of antitrust agencies as

it relates to vertical mergers is that where the firm seeking to merge or acquire is a monopoly in

the input market, there is a high likelihood of foreclosure of the other downstream outsiders20.

This type of M&A’s involves a company coming into a direct partnership with its suppliers and

distributors, that is, a manufacturing company for Instance either merges with or acquires its

distributors. Vertical M&A’s are encouraged in industries where there is intra brand competition

like the banking sector.

17
All Answers Ltd, ‘The Laws of Mergers and Acquisitions’ (Lawteacher.net, March 2021)
<https://www.lawteacher.net/free-law-essays/business-law/the-laws-of-mergers-and-acquisitions-law-
essays.php?vref=1>
18
Ibid.
19
Jrisy Motis, ‘Mergers and Acquisition Motives’ [2007] Toulese School of Economics- EHESS (GREMAQ) and
University of Crete.
20
Ibid 7.
2.4.3. Conglomerate Mergers and Acquisitions:

This is a type of transaction that occurs between unrelated businesses that are neither competitive

nor having related customers or suppliers. It is simply a merger or an acquisition that is neither

vertical nor horizontal. For these types of transactions to be true conglomerate mergers, no

economic relationship should exists between the merging firms or the acquiring firm and the

target.

Concentric Marketing and Concentric Technology involves a combination of businesses where

the buying company shares the same customer types with the selling company but where both

operate different technology and where both have same technology but different marketing styles

respectively.

2.5. Distinction between Mergers and Acquisitions:

Mergers and acquisitions which are often times used interchangeably could mean slightly

different things. In practice however, both could simply be referring to alternative methods of

achieving business combination21.

Acquisitions carry a more negative connotation than mergers especially if the target firm shows

resistance over being bought, and this is why most acquiring companies refer to an acquisition as

a merger even though it is technically not22. In other words, the most commonly used distinction

between a merger and acquisitions is that the latter is seen as hostile while the former is seen as

friendly. The major determinants of how a combination will be viewed are the impressions of the

target company’s shareholders, board of directors and employees.

21
Onyinye OC Chukwuocha, ‘Competition Issues in Mergers and Acquisitions in Nigeria and Competition and
Consumer Protection Act 2019’ [2019] (3) (2) African Journal of Law and Human Rights, 159.
22
Ibid (n 11).
On this issue of the distinction between mergers and acquisitions, it is the opinion of Dr OA

Osunbor23 that;

‘it is important to note the difference between a take-over (or acquisition) and a
merger which is that in the former, the direct or indirect control over the assets of
the acquired company is transferred to the acquirer. In a merger, the separate
shareholdings in the two companies are now merged or combined into one
company, whereas in a takeover, control passes onto and resides in the company
that has taken over another. A merger does not necessarily result in control
passing onto the bigger company. “A” for a single shareholder of group with large
bloc of votes in company “B” may command enough votes in the combined
enterprise to assume control over it’24.

Also according to Orojo25 “whilst in a merger, the whole undertaking of the acquired

company is merged in the acquiring company, in a takeover, the target company remains

separate and distinct but as a subsidiary of the acquiring company”.

Another difference between mergers and acquisitions is that while a merger may accompany

changes in the ownership and management structure of the company, it may not be adverse to the

shareholders of the merged entities. But in an acquisition, the acquired company entirely loses its

management and ownership structure and this change is usually on adverse conditions to the

target company’s shareholders.

The distinctions between M&A’s are usually somewhat neutralized by the law and the regulator

and this is done through very tight legislative drafting that seeks to avoid leakage and ensure that

no transaction type escapes regulation26. This is seen in the FCCPA which defines a merger to

23
OA Osunbor, ‘The Nigerian Law of Takeovers and Mergers’ ([1989] (2) (5) The Gravitas Review of Business and
Property law Journal (GRBPL) 40, quoted in Amos Oyiwe, ’Of Mergers and Acquisitions: Practice and Procedure’
Business law (22 November 2004).
24
Ibid.
25
Orojo J O , Company Law and Practice in Nigeria (3rd edn, Lagos: Mbeyi & Associates (Nig) Ltd 1992) 426.
26
Joseph Onele & Ors, ‘Law and Practice of Mergers and Acquisitions in Nigeria’ [2015] SSRN Electronic Journal
DOI:10.2130/ssrn.2652362 https://ssrn.com/abstract=2652362
include all kinds of business takeover and combination transactions. Given the blurry lines, the

question of whether a transaction is a merger and another an acquisition is effectively one of

market accepted practice and the legal procedure adopted in effecting the transaction. It is also

noteworthy that often in practice, a merger exists where neither company is portrayed as the

acquirer or the acquired27.

2.6. Reasons Why Companies Merge or Acquire:

1. Synergy - In Chesebrough Products Industries ltd and Lever Brothers of Nigeria Suit No

FHC/1/ M.49/88 (unreported)28 it was held that the combined strengths of the two firms backed

with a strong marketing strategy would provide opportunity for a strong positioning of the brands

and a strengthening of their position in the market place and the operation of the synergies would

result in savings and improved quality of earnings.

2. M&A’s gives a company with poor performance the opportunity to secure efficient

management or to acquire innovative capacity. It also gives failing companies access to capital

for the prevention of liquidation.

3. M&A’s sometimes offer the quickest ways for a company to transfer to a new market, obtain a

new product line or accumulate sufficient economies of scale to compete effectively in a

transnational market.

4. M&A’s also serves the purpose of eliminating or reducing competition which in turn gives the

necessary leverage to raise prices for higher profits.

27
Omotayo Akinrinwa, ‘An Overview of Mergers and Acquisitions Under Nigerian Law’ [2017] (1) (1) Unilag Law
Review.
28
E.M Asomugha ‘A Re-Appraisal of The Functions of The Court in Schemes of Arrangement, Mergers and Take
-over’s (1991) Jus. Vol 2, No.1, p.41 quoted in Amos Oyiwe ‘Of Mergers and Acquisitions: Practice and procedure
(3)’ Business Law, 6 December 2004.
5. Political influences also largely impact on M&A transactions. This was seen in 2004 when the

CBN reset the capital base for banks in Nigeria. This development lead to an increase in M&A

activity in the banking sector and also served to reduce the number of banks.

2.6. Legal and Regulatory Framework for Mergers and Acquisitions in Nigeria.

2.6.1. Legal Framework:

The Federal Competition and Consumer Protection Act is the primary legal framework for

mergers and acquisitions in Nigeria. The Notice of threshold for merger notification, merger

review guidelines and merger review regulations were made pursuant to the FCCPA and also

serve as legal frameworks for M&A transactions in Nigeria. Other laws and regulations

regulating M&A transactions in Nigeria include;

2.6.1.1. The Common Law:

It may appear difficult to find a principle of common law which deals directly with mergers and

acquisitions. This phenomenon may serve as an explanation to why there seems to be a lax or

lenient attitude towards the abuses that go with merger and acquisitions by the courts29. In the

case of Gething v Kilner30 the court held that there was nothing wrong with the directors of the

company securing the shareholders approval by means of a misleading circular so long as the

directors honestly believed that a take-over bid was advantageous to the shareholders.

Majority of the cases that emanate from business restructuring transactions especially external

restructuring, concerns the interest of dissenting shareholders whose shares would have been

29
OA Osunbor, ‘The Nigerian Law of Takeovers and Mergers’ ([1989] (2) (5) The Gravitas Review of Business and
Property law Journal (GRBPL) 40, quoted in Amos Oyiwe, ’Of Mergers and Acquisitions: Practice and Procedure’
Business law (22 November 2004).
30
(1972) 1 WLR 337.
acquired at an undervalue. Another issue concerns the breach of the fiduciary duty of a director

of a company which requires him to always use his powers for a proper purpose and not for a

collateral purpose. In Hogg v Crompton31 it was held that the directors of the defendant company

used their powers improperly and breached their duty when they issued shares with special

voting rights which were vested in trustees to be voted to forestall a takeover bid. The directors

acted on the belief that it was in the interest of the company to defeat the bid so as to ensure that

the company’s management continued safely in their hands.

This strict attitude of the court was however departed from in Harlowe’s Nominees Property Ltd

v Woodside (lakes Entrance) Oil Co.32 and Teck Corporation Ltd v. Miller33 where the court

upheld the directors allotment of shares even though they resulted in the defeat of takeover bids.

2.6.1.2. Companies and Allied Matters Act (CAMA) 2020:

Section 119, 120 and 121 CAMA 2020 introduces a new transparency provision as regards the

ownership of companies. Section 119 mandates persons of significant control over companies to

within 7 days of gaining such control, disclose the particulars of it in writing to the company

which must in turn notify the Corporate Affairs Commission (CAC) within one month and also

disclose such significant control in all subsequent annual returns filed with the CAC.

Section 120 provides that a person who is a substantial shareholder in a public company (i.e.

holding either by himself or by his nominee- shares in the company which entitles him to

exercise at least 5% of the unrestricted voting rights at any general meeting of the company) is

31
(1967) 1 Ch 254.
32
(1968) 121 CLR 483.
33
(1972) 33 DLR (3d) 288.
required to disclose such substantial shareholding to the company within 14 days of becoming

aware of such substantial shareholding.

It is the opinion of an author34 that these provisions invariably make due diligence in mergers and

acquisitions in Nigeria easier with respect to varying significant control in, and substantial

ownership of shares of, companies.

Section 711 also provides that where under a scheme proposed for a compromise, arrangement

or reconstruction between two or more companies or the merger of any two companies, the

whole or any part of the undertaking or the property of any company concerned in the scheme is

to be transferred to another company, the court35 may order separate meetings of the companies

affected upon application in summary by one of them. Section 71236 reintroduces Section 129 of

the Investments and Securities Act into CAMA 2020.

Finally, Section 849 CAMA provides that two or more associations with similar aims and objects

may merge under such terms as may be prescribed by regulation by the CAC. So far, the CAC is

yet to release any such regulation on the issue of mergers.

2.6.1.3. Investments and Securities Act (ISA) 2007:

Prior to the enactment of the FCCPA, ISA was the principal law regulating M&A transactions in

Nigeria. By virtue of Section 165 of the FCCPA, Sections 118-128 of the ISA was repealed. The

import of this is that the sections are no longer applicable. But in ISA, the sections that apply to

mergers and acquisitions are sections 117-130. Section 117 is the definition section of this part,

and so, sections 129 and 130 of ISA were not repealed by the FCCPA are so are still applicable.
34
Akorede Folarin, ‘The new Regime For Mergers and Acquisitions under The Companies and Allied Matters Act
2020’ https://ssrn.com/abstract=3685095 accessed March 30, 2021.
35
The Federal High Court (Section 868 CAMA 2020).
36
Offer for dissenting shareholders in an M&A transaction.
Section 129 provides for power to acquire shares of a dissenting shareholder and Section 130

provides for the Right of a dissenting shareholder to compel acquisition of his shares.

2.6.1.4. Banking and Other Financial Institutions Act (BOFIA) 2020.

Section 7 BOFIA 2020 reiterates the obligation of banks to obtain the CBN’s prior consent

before embarking on any type of structural or strategic change and/or divestment including

change in control, transfer of significant shareholding in the bank, sale, disposal and transfer of

the whole or any part of the business of the bank, amalgamation or merger with other person and

other such transactions. Failure to obtain the consent of the CBN voids the transaction and

attracts such penalties upon penalties.

Another interesting provision is Section 65 of BOFIA provides that mergers and acquisitions and

other forms of business re-organizations by banks and other organizations regulated by the CBN

are to be conducted in accordance with the provisions of the FCCPA. However the CBN

exercises regulatory oversight over the process instead of the FCCPC and in addition, provide

additional guidelines on business combinations within the financial services sector37.

2.6.1.5. Nigerian Communications Commission Act:

According to this Act, all mergers, acquisitions and joint ventures involving telecommunication

companies incorporated in Nigeria are regulated by the Nigerian Communication Commission

(NCC) and pursuant to the NCC Act; the transfer of shareholding above 10% between any

companies operating in the telecommunication sector requires approval of the commission. The

Nigerian Competition Practice Regulations 2007 made pursuant to the NCC Act 2003 requires a

37
KPMG Nigeria, ‘BOFIA 2020: Impact on the Financial Services Industry’ April 2021, accessed 11 June 2021.
licensee to obtain prior approval of the commission in respect of a direct or indirect transfer of

acquisition of any individual licensee previously granted by the NCC.

2.6.1.6. The Electric Power Sector Reform Act:

It requires notification of approval to be given to the Nigerian Electricity Commission before an

acquisition or an amalgamation can take place in the sector. The Section 69(2) of the Act

requires that any licensee who intends to acquire interest from any firm that is in the business of

electricity generation, transmission, system operation, distribution or trading other than as

provided for in Sections 65(2), 67(2) and 68 of the Act has to notify the Commission.

2.6.1.7. Insurance Act38:

The Act provides that for any merger or acquisition to take place within the insurance sector, the

approval of the National Insurance Commission (NAICOM) and sanction of the court must first

be obtained before companies can amalgamate. The Act also contains other provisions that

regulate approval of mergers in the insurance sector39.

2.6.2. Regulatory Framework:

The various regulatory agencies vested with the authority to approve merger and acquisition

transactions directly or indirectly across various sectors are;

 The Federal Competition and Consumer Protection Council (FCCPC).

 Securities and Exchange Commission.

 Nigerian Stock Exchange - When an acquisition involves the shares and assets of a public

listed company, there are provisions in the rulebook of the NSE to the effect that there
38
Cap 118 LFN 2004.
39
Section 30 NAICOM Act.
 should be disclosures to the NSE of a deal that would bring a change in the beneficial

ownership of the company’s shares owned by the investor to 5% or more. Further, the

rulebook requires the shares of publicly quoted companies to be exchanged on the floor

of the NSE as part of the completion process for the transaction40.

 National Association of Securities Dealers (NASD)

The NASD is a body responsible for regulating the sale and purchase of securities of unquoted

public companies. Pursuant to the SEC Rules on Trading in Unlisted Securities 2015, no person

shall buy, sell or otherwise transfer securities of an unlisted public company except through the

platform of a registered securities exchange established for the purpose of facilitating over-the-

counter trading of securities.

Other regulatory agencies include;

 The Central Bank of Nigeria.

 The Department of Petroleum Resources.

 The Corporate Affairs Commission.

 The National Insurance Commission.

 The Nigerian Communication Commission.

 The Nigerian Electricity Commission.

40
The acquirer may also be requires as part of the exchange process to open an account with the Central Securities
Clearing System (CSCS) The CSCS is a central depository that is responsible for maintaining records of transaction
undertaken on the floor of the NSE. The CSCS is responsible for clearing and settlement of transactions in shares on
the floor of the NSE (where it does not already have a CSCS account). This account would be opened on behalf of
the acquirer by a Nigerian Licensed stockbroker appointed by the acquirer