• Monday, December 04, 2023
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GSK Nigeria shareholders urge board, FG to save firm from exit

Forex shortage and internal tussles that prompted GSK’s exit

Shareholders of GlaxoSmithKline Consumer Nigeria Plc have called on the board and management and federal government to save the company from the brink of collapse, even as they approved an N657.73 million dividend declared at the company’s 52nd Annual General Meeting.

Moses Igbrude, national coordinator, Independent Shareholders Association of Nigeria (ISAN) expressed concerns regarding the gradual shift of the activities of GSK Nigeria from a manufacturing company to a distribution company just as what now exists in the Kenyan market.

“I fear that there is a rumour going on that GSK is closing down our production manufacturing here (in Nigeria) and then transmitting it to a Distributor and that we would only be importing the drugs into this country,” he said while speaking at the company’s AGM.

“We have read what happened in Kenya and we are worried. GSK Nigeria has been a good citizen and a good neighbour and we are all together as shareholders, we have been part of it.

“We need you to explain what is going on. Is it true or is there any element of truth in it?” Igbrude queried.

He, however, argued that if the federal government can show the political will necessary to drive some of its current policy pronouncements, the current situation can be reversed.

Nonah Awoh, another shareholder, cited the massive reduction in the number of staff at the company’s plant as an ill sign that all may not be well regarding the continuous stay of GSK as a manufacturing company in Nigeria.

Awoh noted that “Looking at this account on Page 79, we have brought the strength of production from 25 men and women to just nine. Even factories that produce pure water in Ikorodu where one of my friends stays, have more than nine men in production.”

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Edmund Onuzo, chairman of the board, admitted and corroborated an earlier release by GSK Nigeria that the company is facing major challenges.

“The challenges ahead are quite significant, as some of you may have read reports from a few media houses regarding the supply constraints on GSK drugs in the market.

“We must mention that it continues to be very challenging with foreign exchange non-availability affecting our ability to settle foreign currency-denominated trade payables with product suppliers. As a result, it remains difficult to maintain consistent supply to the market,” Onuzo explained.

Regarding the uncertainty concerning the continued stay of GSK in Nigeria as either a manufacturing or distribution company, Onuzo said “We have also received communication from GSK UK and Haleon, the brand owners of our consumer healthcare products regarding the continuation of existing business relationships that necessitates the Board of Directors having further engagements with the GSK Global and our advisors regarding the best way to navigate the current circumstances. We will let you know as the discussions progress”.

However, as GSK reaches an agreement to acquire late-stage biopharmaceutical company BELLUS Health – a Canada-based firm, the shareholders also asked about what the acquisition portends for the continuous operation of the company in Nigeria.

The shareholders approved a dividend of 55kobo per share, which is an increase from the 45kobo declared in 2021. The shareholders appreciated this growth and reaffirmed their belief in the leadership of the company to grow the business into the coming year.