Business
Twitter’s IPO gives NYSE momentum in battle against Nasdaq
NEW YORK – Twitter Inc’s successful debut on the New York Stock Exchange could help the Big Board win a title it has never held before: the No 1 US listing venue for technology companies.
Nasdaq OMX Group had easily scored the most tech initial public offerings every year from 1999 until last year, when NYSE Euronext pulled even, according to Thomson Reuters data.
Including Twitter this week, 19 tech companies have chosen to go public on the NYSE in 2013, while Nasdaq has won only 14 listings so far this year. Tech IPO proceeds also favor the NYSE over Nasdaq, at $4.6 billion to $1.9 billion, according to Thomson Reuters data.
The reversal is attributed partly to Nasdaq’s high-profile bungling of Facebook Inc’s debut last year, and partly to changes the NYSE made to its listing standards in 2008 to make it easier for smaller, growing companies to qualify. “I wouldn’t even say they won Twitter, I’d say we lost it,” said Bruce Aust, who has headed Nasdaq’s listings business for the past decade. He said that since 2008, when the NYSE changed its listings rules and lowered requirements for market capitalisation and income limits, every deal has become competitive.
“They did that because they realised that once a company lists on Nasdaq, they really stay with us,” said Aust. Twitter began trading at NYSE. Reuters Facebook’s $16 billion IPO was highly anticipated but a glitch in Nasdaq’s fully electronic system set off a series of events that some market makers said prevented them from knowing their positions in the stock – and led to them to lose $500 million collectively.
Nasdaq is voluntarily compensating firms a total of $41.6 million, and was fined another $10 million by the US Securities and Exchange Commission. In contrast, Twitter’s listing on the Big Board went off without a hitch on Thursday, with the stock gaining an eye-opening 73 percent. The NYSE, one of the last exchanges with a trading floor staffed by human beings, had the world’s media observe the debut, with NYSE and Twitter executives, as well as X-Men and Star Trek actor Patrick Stewart, on hand to help promote the offering.
“Clearly, the Facebook fiasco has hurt Nasdaq and the fact that the NYSE pulled off the Twitter IPO with no technological glitches certainly is good for them,” said Jay Ritter, a professor and IPO expert at the University of Florida. Ritter said the probability was “incredibly good” that had the Twitter IPO gone to Nasdaq, it would have gone smoothly as well, and that in reality, there is not much difference to companies when it comes to listing on one exchange or the other.
But the listing business is largely about prestige. WINNING AND LOSING This year has seen the strongest market for US IPOs since 2007, as equity markets soared, helped by continued economic growth and the Federal Reserve’s efforts to keep interest rates low.
The NYSE and Nasdaq have taken steps this year to form closer relationships with technology firms before they go public. The moves come with the passing of the Jumpstart Our Business Startups (JOBS) Act last year in March, which loosened a number of securities regulations in hopes of boosting capital raising, and thereby increasing job growth.
The NYSE said in September it was getting into the $1 trillion-a-year private placement business through a minority stake in Ace Group Inc, which runs a private issuance platform for equity, debt and other securities. Nasdaq plans to create a market for trading shares of unlisted companies in a joint venture with trading platform SharesPost Inc, which now lists more than 200 private companies, including Pinterest, Foursquare, eHarmony and Tumblr.
“We’ll be involved much earlier with these private companies and eventually we hope they’ll go public on Nasdaq,” said Aust. With tech giants like Apple Inc, Microsoft Corp, Google Inc, and Amazon.com Inc in its roster, Nasdaq traditionally has seemed the natural place for technology listings. In 1999, before the dot-com bubble burst, Nasdaq had 246 technology IPOs, or 95 percent of the listings, while the NYSE had just seven, or 2.7 percent, according to Thomson Reuters data.
Fast forward to 2012, and the NYSE had caught up to Nasdaq in tech IPOs, with each recording 17, though proceeds of the NYSE listings, at 2.8 billion were eclipsed by the Nasdaq listings, at $17.5 billion, which benefited from the Facebook IPO. Nasdaq uses a different system for categorizing tech companies, including, for instance, telecommunications services firms in its count.
Thomson Reuters only includes companies classified as high technology using the Standard Industrial Classification system, which groups telecoms separately. Using Nasdaq’s methodology, it has hosted 24 technology IPOs this year, against the NYSE’s 22. The NYSE uses yet a different classification system, and says it has had 26 technology listings so far in 2013.
Doug Chu, head of the NYSE’s Silicon Valley office, pointed to the Big Board’s 2008 listings change as the turn-around point for technology company IPOs. “The culture at the NYSE has changed over the last few years. We’re more proactive and focused on technology and growth companies,” Chu said. Reuters
The Office of the Auditor-General of the Federation has uncovered financial irregularities amounting to ₦514 billion in the 2021 operations of the Nigerian National Petroleum Company Limited (NNPC Ltd).
The revelations were contained in a comprehensive audit report highlighting non-compliance and internal control weaknesses within Ministries, Departments, and Agencies (MDAs) during the 2021 financial year.
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Breakdown of Infractions
The audit detailed four major financial discrepancies within NNPCL:
“Irregular Deductions: A total of ₦343.64 billion was deducted from domestic crude oil sales at source without proper documentation.
“Sinking Fund Deposits: ₦83.66 billion, categorized as miscellaneous income, was retained in a sinking fund account.
“Unauthorised Refinery Deductions: ₦82.95 billion was deducted from federation revenue purportedly for refinery rehabilitation.
“Unsubstantiated Payments: ₦3.75 billion was flagged for transactions related to petrol sales that lacked proper verification.
The Auditor-General’s report stated that these financial activities violated the 1999 Constitution and the Financial Regulations Act of 2009, underscoring significant lapses in compliance with statutory guidelines.
According to the report, NNPCL generated ₦484.73 billion from domestic crude oil sales in March and May 2021.
However, ₦343.64 billion was deducted for various purposes, including “Value Shortfall,” “Strategic Stock Holding Cost,” and “Pipeline Maintenance.”
The deductions were made unilaterally by NNPCL without adequate documentation or justification.
Additionally, the report flagged ₦50 billion of the net payable amount for May 2021 as unaccounted for, creating a significant gap in the federation’s revenue.
“Audit observed from the review of NNPC SAP payment record for March and May 2021 payments that the sum of ₦484.73bn was the gross amount generated for the sale of domestic crude for the months of March and May 2021.
“The sum of ₦343.64bn from the gross amount was unilaterally deducted from the gross domestic crude sales as NNPC Value shortfall, Strategic Stock Holding Cost, Crude Oil and Products Pipeline Losses, as well as the pipelines maintenance and management costs.
“The details of each of the cost components deducted were not provided for audit review. Hence, the reasons for the deductions could not be justified by the management.”
On the unremitted ₦50 billion from May 2021, the report noted: “In the month of May, the net payable that could have been remitted ought to have been ₦127.075bn, but only the sum of ₦77.075bn was remitted, leaving an unremitted balance of N50bn to the Federation Account, which has remained unaccounted for.”
The report attributed these anomalies to weaknesses in NNPCL’s internal control systems, warning of the risks they pose to public funds.
It read, “The above anomalies could be attributed to weaknesses in the internal control system at NNPC, now NNPC Ltd. This is a potential loss of Federation revenue, diversion of public funds, or misapplication or misappropriation of funds.”
The success of the maiden edition of the Lagos Shopping Festival (LSF), Africa’s first 72-hour non-stop commerce and entertainment event has been credited to the Governor of Lagos State, Babajide Sanwo-Olu.
This is the view of Managing Director/Chief Strategist of Chain Reactions Africa Ltd, Israel Jaiye Opayemi, one of the main organisers of the event.
According to Opayemi, though Chain Reactions Africa conceptualised the event, the festival could be rightly described as the Governor’s baby and owes its success to his leadership. “Firstly, the Lagos Shopping Festival could not have come to fruition if the Governor did not buy into our audacious plan when we first presented the idea to him during the Covid-19 pandemic in 2020. Secondly, it was the Governor’s exemplary leadership of the project as its Chief Marketing Officer which attracted the buy-in of key sponsors like Zenith Bank, Tolaram Group, First Bank Plc, and Guinness Nigeria Plc,” Opayemi revealed.
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While the duo of Zenith Bank and First Bank provided their bank on wheel platforms for buyers at the Lagos Shopping Festival, they also supported the Vendors with special Point of Sale Machines with which to process payments from buyers. The banks were also seen marketing their diverse banking products to guests within the shopping arena.
For Tolaram, it was a time to support the citizens and give back to society. Guests at the Lagos Shopping Festival were freely given some of the products of the group such as PowerOil, Indomie and Kellogg’s packaged into goodie bags and given out to prospective buyers at the shopping arena. The Children’s Arena was however activated by Indomie with the children entertained by Santa Claus within a well-equipped arena manned by the Indomie Brands team and the Lagos State Safety Marshalls. The children were daily treated to free Indomie meals daily and given various gifts to go home with.
On its part, Guinness Nigeria came through as the real life of the Nigerian party by organizing product sampling activation for the teeming guests at the festival using brands such as Singleton, Johnnie Walker, Ciroc, Don Royale and Captain Morgan to deliver pleasant experiences to guests aside from Guinness and Malta Guinness.
While unveiling the identity of the festival last month, Governor Babajide Sanwo-Olu had thanked the management of Zenith Bank Plc, Tolaram Africa Group, Guinness Nigeria Plc and First Bank of Nigeria for supporting the idea of a Lagos Shopping Festival, describing it as a value addition on the state’s tourism calendar and the overall efforts to grow the State’s GDP. The Governor further said, “I must specially acknowledge your pioneering sponsorship role. It is easy for a corporate sponsor to jump on the sponsorship band wagon of an already established festival and fund it. But you are supporting the maiden edition of this Lagos Shopping Festival with us. The competition is watching you now. Do not build this brand with us and yield the space for the competition to take over. I do hope you would all commit long term to this brilliant initiative.”
On his part, Girish Sharma, CEO Guinness Nigeria Plc, expressed enthusiasm for the initiative. “Lagos is the commercial heartbeat of Nigeria and Africa’s entertainment capital, and the Lagos Shopping Festival captures its essence. We see opportunities in this initiative because it is a creative fusion of commerce and entertainment. This partnership reflects our dedication to fostering economic opportunities and support the nation’s vibrant entertainment industry.”
A first-of-its-kind, the festival was a convergence of commerce and entertainment, bringing together buyers and sellers in the MSME ecosystem, and hordes of fun-seekers who were entertained with thrilling performances by A-list entertainers, including Adekunle Gold, Wande Coal, Teni, Young Jonn, BNXN, Ayo Maff, SB Live and EmmaOMG. The list also included some of Nigeria’s most sought after DJs such as DJ Neptune, DJ YK Mule, DJ Baddo while Gbenga Adeyinka the 1st and Larry J dished out rib-cracking comedy performances.
Held from 23rd to 25th Day of December 2024, at the iconic Mobolaji Johnson Arena, Onikan Stadium, Lagos, the Lagos Shopping Festival saw thousands of fans throng the main venue and select Lagos malls during the three-day period to bag the latest bargains from local and top global brands.
The Nigerian Naira experienced mixed movements in the foreign exchange markets on Monday, as it depreciated to N1,665 per dollar in the parallel market, down from N1,660 per dollar recorded over the weekend.
In contrast, the official exchange rate saw the Naira appreciate to N1,534.56 per dollar, improving slightly from N1,535 per dollar last Friday, according to data released by the Central Bank of Nigeria (CBN).
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This reflects a marginal gain of 44 kobo in the official Nigerian Foreign Exchange Market (NFEM).
As a result, the gap between the parallel market rate and the NFEM rate widened to N130.44 per dollar, compared to the N125 per dollar margin recorded over the weekend.
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