The Nigerian Stock Exchange (NSE) on Thursday suspended a brokerage firm blamed by fuel retailer African Petroleum (AP) (APET.LG) with deliberately forcing down its share price over the past two months.
The NSE said on Wednesday it was investigating allegations by AP that Nova Finance and Securities Ltd, acting on the instructions of billionaire Aliko Dangote, president of Dangote Group, had been manipulating its share price.
A spokesman for Dangote Group, one of Nigeria’s biggest conglomerates with interests ranging from sugar and cement to oil, has declined to comment but said on Wednesday the group would issue a statement on the matter through its stockbrokers.
The bourse said its findings revealed that the brokerage breached exchange regulations which preclude dealing members from creating a false market on a specific security to effect a change in its share price.
“The Council of The Exchange has suspended Nova Finance and Securities Limited from all capital market activities and a fine of N500,000 ($3,429) per day has been imposed on the firm,” the NSE said in a statement.
It also fined AP 300,000 naira for publishing a two-page statement in Nigerian newspapers over the alleged manipulation, instead of first reporting the matter to the exchange.
AP, one of Nigeria’s top fuel retailers, said there had been “premeditated and orchestrated” crossing of its shares among firms controlled by Dangote and that the value of its stock had fallen more than 80 percent between Feb 11 and March 24.
The stock has risen by nearly five percent in the last two days to close at 53.91 naira on Thursday after the bourse said it was investigating.