Soap maker PZ Cussons (PZC.L) said on Tuesday it has offered to buy out minority shareholders of PZ Cussons Nigeria (PZCN) and aims to de-list the business from the Nigerian stock exchange amid “foreign exchange challenges” in the country.
“The group believes the offer to be attractive for the minority shareholders of PZCN, particularly given the recent macroeconomic developments and foreign exchange challenges,” the company said in a statement.
Inflation in Africa’s largest economy, which has been in double digits since 2016, rose to its highest level in nearly two decades in July at 24.08% against 22.79% in June after the country scrapped a popular but costly subsidy on petrol and devalued the currency.
The Manchester-based company said in June that the devaluation of Nigeria’s naira currency would adversely impact its profit next year.
PZ Cussons’ offer to the PZCN board is to acquire minority shareholders’ 26.73% stake for 22.8 million pounds ($28.7 million). The group said the funding for the transaction is expected to come from existing naira cash balances.
Last month, GlaxoSmithKline Nigeria (GLAXOSM.LG) said it plans to stop doing business after evaluating the options for moving to a third-party distribution model for its drugs and consumer healthcare goods.
($1 = 0.7933 pounds)
Reporting by Aby Jose Koilparambil in Bengaluru; editing by Janane Venkatraman and Jason Neely