Nigerian Stock Exchange Hopes For Flutterwave Ipo Boost

The Nigerian fintech unicorn Flutterwave, one of Africa's most prominent payment services providers, is reported to be preparing for an initial public offering IPO on the Nigerian stock exchange NGX, raising hopes of a major boost to a market which has experienced mixed fortunes in recent years.

While specific details of the potential listing are yet to emerge, Flutterwave executives met with Nigeria's president Bola Tinubu last week in order to discuss floating the company on the stock market. Securing such a commitment from Flutterwave, which became Africa's fourth unicorn - a company valued at more than 1bn - after raising 170m in a Series C funding round in March 2021, would be a major coup for Nigerian equity markets.

Indeed, stock markets in Nigeria and across Africa have in the past struggled to attract major listings owing to an insufficient amount of liquidity which can distort prices. Several major companies in Nigeria - such as e-business Courteville Business Solution - have delisted in recent years over concerns that the low liquidity has led to rock-bottom share prices that do not necessarily reflect the fair market value.

A potential way around this for Flutterwave could be to explore a dual listing - floating both on the NGX and an international market such as the NASDAQ. Nigerian energy companies Seplat and Oando went public in Nigeria, and London and Johannesburg respectively, in order to secure stronger valuations and boost their credentials on international financial markets.

While the Nigerian stock exchange has continued to grow in strength over the past two years - the NGX All Share Index has more than doubled since the start of 2023 - it has also faced several hurdles. In September 2023, the leading provider of market benchmarks, FTSE Russell, downgraded Nigeria from a "frontier" to an "unclassified" market.