The Ghana Stock Exchange (GSE) and Venture Capital Trust Fund have signed a Memorandum of Understanding (MoU) to promote the listing of SMEs on the GSE.
Managing Director of GSE Mr Kofi Yamoah and CEO of VCTF Mr Daniel Duku signed the MoU enabling both institutions collaborate with other stakeholders to develop alternative market for SMEs.
The MoU would ensure that they jointly lead the SMEs listing project, coordinate with other stakeholders, facilitate the underwriting and provide upfront funding for SMEs to list and hold public fora and education for both SMEs and the public.
Indicating the partnership’s support for SMEs, Mr Yamoah said “The MoU is about Ghana. There are many SMEs and with the right growth strategy can help accelerate the pace of development.”
According to VCTF’s boss, the relationship with the Exchange in the alternative SMEs market would provide good exit strategies for venture capital finance companies and SME investors.
“We are coming on board as great partners in the Alternative SMEs market,” he said, adding that the company was putting into the revolving fund $500,000 to support the scheme.
He said the GSE is setting up a revolving fund to pay for the listing expenses such as underwriting and legal fees of the companies adding that an agreement to that effect has been signed with Accra-based Fidelity Capital Partners, to pool resources for the fund and discussions are on-going with the African Development Bank and other development partners to contribute to the fund.
An official of the GSE also explained that the revolving fund would provide resources to have listing expenses paid ahead of actual public floatation.
The MoU is part of efforts by the GSE to encourage listings and improve liquidity on the bourse while giving SMEs the opportunity to raise capital from the bourse.