GlaxoSmithKline Consumer Nigeria plc (GSK Nigeria) announced its decision to cease operations in Nigeria after receiving notice of GSK UK Group’s strategic intent to halt the commercialization of prescription medicines and vaccines in the country.
Adding to the blow, the Haleon Group also informed the Board of its plans to terminate its distribution agreement in the coming months, leaving the company with no other option but to shut down.
GSK Nigeria revealed this development in their published Q2 results, expressing their disappointment at the decision made by GSK UK Group, one of the world’s leading pharmaceutical giants.
The termination of distribution agreements has led the Board of GSK Nigeria to extensively evaluate various alternatives but ultimately arrive at the conclusion that closing operations is the only viable path forward.
The company emphasized that its priority remains the well-being of its employees, promising to treat them fairly and respectfully throughout the transition process, and meeting all legal and consultation requirements. As the company navigates through this challenging period, they have been actively working with professional advisors to determine the next steps.
“We are deeply grateful for the support we have received from the GSK Group in our efforts to handle this situation responsibly,” said Frederick Ichekwai, the Company Secretary. “We are committed to finding a resolution that takes into consideration the interests of our shareholders, and we are working on submitting a draft Scheme of Arrangement to the Securities and Exchange Commission (SEC) shortly.”
The proposed Scheme of Arrangement may offer shareholders (excluding GSK UK) an accelerated cash distribution and return of capital, pending approval by the SEC and shareholders. However, GSK Nigeria has urged shareholders to exercise caution and seek professional advice when dealing in the company’s shares until further announcements are made.
The news has sent ripples through the investment community and raised questions about the implications of GSK UK Group’s strategic decision on the Nigerian pharmaceutical market. Investors and media outlets have expressed keen interest in understanding the full extent of the impact and what lies ahead for the Nigerian healthcare landscape.
GSK Nigeria’s Investor and Media queries are to be directed to [email protected] and [email protected]. Additionally, shareholders are encouraged to reach out to [email protected] for any inquiries related to the Scheme of Arrangement.
