Soap maker PZ Cussons said 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.
Minority Shareholders
PZ Cussons' offer to the PZCN board is to acquire minority shareholders' 26.73% stake for £22.8 million (€31 million). The group said the funding for the transaction is expected to come from existing naira cash balances.
Last month, GlaxoSmithKline Nigeria 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.
PZ Cussons expects a higher full-year profit, encouraged by a strong fourth-quarter performance in Africa and improvement in the soap maker's margins due to price hikes earlier in the year.
The Imperial Leather and St Tropez maker achieved like-for-like revenue growth of 6.7% in the fourth quarter, contributing to an overall growth of 6.1% for the entire fiscal year.
The group will report results for the year ended 31 May on 26 September 2023.
