GlaxoSmithKline (GSK) Consumer Nigeria Plc has announced that it will cease operations after evaluating the options for transitioning its pharmaceutical products to a third-party distribution model.
Augmentin, Neosporin, Panadol, Sensodyne, Advair, Ventolin, and Theraflu are among the company’s well-known products.
GSK Nigeria announced the news in a statement sent to the Nigeria Exchange Limited (NGX) on Thursday and signed by the company secretary, Frederick Ichekwai.
The company stated that it is working with its advisers to agree on next steps and intends to file a scheme of arrangement with the Securities and Exchange Commission (SEC) that, if approved, will result in the return of cash to all shareholders except its parent company, GSK UK.
The company, which employs over 290 people, assured employees and shareholders that all necessary legal proceedings would be followed.
‘In our published Q2 results, we disclosed that the GSK UK Group has informed GlaxoSmithKline Consumer Nigeria PLC of its strategic intent to discontinue commercialization of its prescription medicines and vaccines in Nigeria through the GSK local operating companies and transition to a third-party direct distribution model for its pharmaceutical products,’ according to the statement.
“In addition, the Haleon Group has separately informed the Board of its intention to terminate its distribution agreement in the coming months and appoint a third-party distributor in Nigeria to supply its consumer healthcare products.”
“For the aforementioned reasons, and having evaluated various other options with GSK UK, the Board of GlaxoSmithKline Consumer Nigeria Plc has concluded that there is no alternative but to cease operations.”
“Today, we briefed our employees on how we will treat them fairly, respectfully, and with care, in accordance with all applicable legal and consultation requirements.”
“The Board recognises that shareholders will have many questions; we have been working diligently with our professional advisors to agree on next steps, and we will be submitting to the Securities and Exchange Commission (“SEC”) shortly a draught Scheme of Arrangement that, if approved, may result in an accelerated cash distribution and return of capital to shareholders other than GSK UK.”
“The Board recognises the GSK Group’s support in its intentions to make this possible, full details of which we hope to publish shortly.” In the meantime, we cannot guarantee the final terms of any scheme, nor can we guarantee that any scheme will be approved by the SEC or by shareholders.
“Shareholders are advised to seek professional advice and to continue to exercise caution when dealing in the company’s shares until a further announcement is made.”
