MRS Oil to Delist from NGX After Posting Record Profits

MRS Oil Nigeria Plc has announced its decision to voluntarily delist from the Nigerian Exchange Limited (NGX), just hours after reporting a record-breaking profit after tax of N6.49 billion for 2024, marking a 62.2% year-on-year growth. This move follows an extraordinary general meeting (EGM) held on June 25, 2024, where shareholders approved the delisting plan.

MRS Oil’s Financial Performance in 2024

Despite challenges in the petroleum sector, MRS Oil recorded a 71.2% surge in revenue, reaching N312.2 billion, driven by:

• Increased consumer demand following its purchase of refined products from the Dangote Refinery.
  
• Improved fuel efficiency perceptions among customers, contributing to higher sales.
  
• Offsetting sales volume declines caused by the hike in Premium Motor Spirit (PMS) prices after deregulation.
  

Why MRS Oil is Leaving the NGX

MRS Oil’s decision to exit the NGX aligns with a broader trend among mid-sized companies seeking greater operational flexibility and lower listing costs. According to the company, delisting will:

• Reduce compliance costs associated with maintaining an NGX listing.
  
• Enable long-term strategic growth without the constraints of public market regulations.
  
• Improve shareholder value through share buybacks and capital reduction.
  

Following its delisting, MRS Oil plans to list its shares on the NASD OTC Securities Exchange, ensuring continued trading for investors.

Share Buyback Plan and Exit Strategy

To facilitate a smooth transition, MRS Oil will implement a share buyback program and capital reduction, allowing dissenting shareholders to exit. Key details include:

• Claim period: April 4 – July 4, 2025.
  
• Compensation: The company has set aside funds to buy out shareholders unwilling to migrate to the NASD platform.
  
• Migration: Shareholders who do not opt for the buyback will have their shares automatically transferred to the NASD OTC Exchange.
  

Regulatory Compliance and Next Steps

MRS Oil has assured stakeholders that the delisting process will comply with all regulatory approvals from the Securities and Exchange Commission (SEC) and the NGX. The company also emphasized that it remains committed to engaging shareholders and keeping them informed throughout the process.

The Growing Trend of Delistings in Nigeria

MRS Oil is the latest in a series of companies exiting the NGX in recent years. Other notable delistings include:

• GlaxoSmithKline (GSK) Consumer Nigeria Plc, which left due to strategic business reviews.
  
• Union Diagnostics and 11 Plc (formerly Mobil Oil Nigeria), both of which shifted to the NASD OTC Exchange.
  

With a pre-delist market capitalization of approximately N59 billion, MRS Oil’s exit highlights ongoing structural issues in Nigeria’s capital market, including:

• Rising compliance costs for listed companies.
  
• Low trading liquidity on the NGX.
  
• Challenging macroeconomic conditions, prompting firms to seek alternative listing options.
  

What This Means for Investors and the Market

MRS Oil’s delisting marks another major shift in Nigeria’s financial landscape, reinforcing concerns about the NGX’s ability to retain mid-sized and multinational companies. While the company is optimistic about its future post-delist, the trend of corporate exits highlights the need for urgent market reforms to restore investor confidence and encourage companies to remain publicly listed.