Glaxo Smith Kline Consumer Nigeria Plc has received approval from the Securities and Exchange Commission (SEC) and the Federal High Court for its share buyback initiative, as disclosed in a notice filed with the Nigerian Exchange Limited on Thursday.
GSK Consumer Nigeria had earlier unveiled its intention to cease operations in the country in August, citing its parent company, GSK Plc UK’s decision to discontinue the commercialization of prescription medicines and vaccines through its Nigerian subsidiary. Instead, the company plans to transition to a third-party direct distribution model for its pharmaceutical products.
The regulatory approvals were granted following a court-ordered meeting held in December, where the shareholders of the company gave their nod to the proposed Scheme of Arrangement. The buyback of shares from minority shareholders will be executed at the agreed-upon rate of N17.42 per unit, according to the company’s statement.
“GSK Consumer Nigeria hereby notifies Nigerian Exchange Limited, our esteemed shareholders, and other stakeholders that the company has now received Securities and Exchange Commission’s formal approval of the scheme. The order of the Federal High Court sanctioning the Scheme of Arrangement has also been obtained,” the statement read.
The company indicated that it will soon submit an application for the delisting of its shares from the Nigerian Exchange Limited.
The decision to exit the Nigerian market has sparked reactions from shareholders, who have urged the government to intervene and address the trend of multinational companies leaving the country. GSK Nigeria, incorporated in 1971, currently has 46.4% of its shares held by Setfirst Limited and Smithkline Beecham Limited (both incorporated in the United Kingdom), with the remaining 53.6% held by Nigerian shareholders.
This move by GSK adds to a growing list of multinational firms that have either closed down operations or announced plans to exit Nigeria, including Procter & Gamble, Jumia Food, Bolt Food, Sanofi & Aventi, and Equinor, all making similar decisions in 2023.
