Glaxosmithkline Investors See 56% Capital Gain in One Week

Investors in Glaxosmithkline Consumer Nigeria Plc, GSK, witnessed a record 55.6 per cent capital gain last week as a result of the bullish run that rocked most of the trading sessions at the stock market.

The shares gained N7.90, a leap from N14.22 to close at N14.22 per share in a week that 40 stocks appreciated. Market operators said the renewed demand for GSK could be for speculative reasons.

In other developments, the company is to divest its drinks bottling business that manufactures Lucozade and Ribena to Suntory Beverages Nigeria Limited.

The proposed divestment followed the purchase of business by Suntory Beverages Japan from GSK United Kingdom, the parent firm of GSK Nigeria in 2013.

An official of the company, who explained the divestment, said: “The drinks bottling used to be part of our business but we belong to a group, GSK which has divested from that line of business and we need to maximize our potential. We are facing the direction our parent company is facing.”

“Other subsidiaries have divested the drinks business but Nigeria was allowed to continue. But the divestment will enable us release the assets to Suntory Beverages so that we can concentrate on those things we are good at.”

In a notification to the NSE, the Company Secretary of GSK Nigeria, Mr. Uche Uwechai had said the principal terms of the offer would set out in a circular to the shareholder.

“If the shareholders and regulators were to approve the sale, the retained business of GSK Nigeria would include its wellness, oral healthcare, nutrition and pharmaceutical/vaccines businesses and the company would remain listed on the NSE,” he said.

The company has also indicated that subject to the completion of the disposal and receipt of the purchase price the company will pay a special dividend of N716 million (60 kobo per share) to the shareholders.