A share is a title deed issued by a corporation (e.g., a public limited company or a partnership limited by shares). It confers to its holder the ownership of a part of the capital, with the associated rights: to intervene in the management of the company, i.e. to vote at general meetings of shareholders and to receive an income called a dividend, which represents a share of the annual profits distributed by the company.
The holder of shares qualifies as a shareholder and all shareholders constitute the shareholding.
The shares are issued as consideration for the contributions made when the company is created, thereby constituting its share capital.
During its existence, the company may issue new shares during a capital increase that will be subscribed either by existing shareholders or by third party shareholders.
The decision to issue new shares, to whom they are offered for subscription and at what price are sensitive elements in the life of a company.
Conversely, but more rarely, a company may buy back its shares to support the share price by way of a normal course issuer bid. This repurchase is different from the repurchase carried out to support the share price via a liquidity contract, since in the latter case the shares will be resold as quickly as possible.
The issue of shares is therefore often synonymous with a capital increase, while the repurchase followed by cancellation generally corresponds to a capital reduction. The company carrying out these operations therefore sends a message of either growth or decline.
A share buyback program is announced in Nigeria by the billionaire ALIKO Dangote up to 10% of its capital for a value of approximately 6 billion dollars to support the stock market price (see AFRIMAG News of December 22, 2020).
According to the ECOFIN Agency dated August 24, 2020, Heineken is accelerating the purchase of more than 6 million shares of Nigeria Breweries, its subsidiary in Nigeria.
In order to ensure the liquidity of the shares and their constant valuation, the company may decide to list its shares on the financial market.
A share is listed from the moment it can be bought or sold on the stock market, commonly known as the stock exchange. The table below presents, by sector, the shares listed on the Regional Stock Exchange (BRVM).
SECTOR - INDUSTRY
SECTOR - AGRICULTURE
SECTOR - DISTRIBUTION
Source: Official bulletin of the BRVM listing of Thursday, December 30, 2020