BREAKING: Asset management brand BlackRock’s iShares announce exit from Nigeria

BlackRock, one of the world’s largest asset managers, has revealed that it has concluded plans to liquidate its $400 million iShares exchange-traded funds (ETFs) due to unproductive business environments in Nigeria and Kenya, particularly the problem of currency repatriation exacerbated by the naira depreciation.

iShares Frontiers, which has invested millions of dollars in developing market equities in Nigeria and Kenya over the years, has scheduled its last trading day for March 31, 2025, when the delayed liquidation is expected to expire.

“The board of directors of the company approved a proposal to liquidate the fund. In light of persistent liquidity challenges in certain frontier markets, including among other things, delays or limits on repatriation of local currency, the board determined that it is in the best interest of the fund and its shareholders for the fund to liquidate,” said iShares said in a recent statement.

The company said it was opting for an “extended liquidation” given the significance of the naira conversion on the liquidation, which cannot easily be predicted.

“Currency conversions, including conversion of Nigeria’s currency, the naira, will impact the timing of the fund’s liquidation. As a result, the fund will enter into an extended liquidation period,” BlackRock’s iShares stated. “After market close no earlier than August 12, 2024, but on a date as soon as practicable, the fund will cease trading and the creation and redemption of creation units.”

Already, the company has liquidated $5.2 million of its shares in Kenyan companies like Safaricom ($2.8 million), Equity Group ($1.5 million), and KCB Group ($885,000), which are quoted on the Nairobi Securities Exchange (NSE).

The planned exit of BlackRock’s iShares was another dent in Nigeria’s economic scorecard as the one-year-old President Bola Tinubu’s administration grapples with Nigeria’s dwindling economic fortunes.

News360 Nigeria recalls that UK pharmaceutical giant GlaxoSmithKline and tech giant Microsoft have also shut down their business operations in Nigeria.