PZ Cussons Plc Buying of Shareholders Rejected by SEC

Last month, the major shareholder of PZ Cussons Holdings announced plans to buy out other shareholders, but this was pending regulatory approvals. On Tuesday this week, the Securities and Exchange Commission (SEC) rejected the request from the Company's major shareholders.

PZ Cussons Nigeria announced to the investing community via the Nigerian Exchange Limited (NGX) that the request to purchase the shares held by other PZ Cussons Nigeria shareholders at N23 a share has been rejected by the capital market regulatory body (SEC).

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The statement signed by the Company's Secretary, Olubukola Olonade-Agaga, reads, 

"PZ Cussons Nigeria Plc ("PZCN" or the "Company") hereby notifies the Nigerian Exchange Limited ("NGX") and the investing public that the Securities and Exchange Commission ("SEC") has declined the Company's request for its No Objection to PZ Cussons (Holdings) Limited's ("the majority shareholder") intention to acquire the shares held by all the other shareholders of PZCN at an offer price of N23 per share (the "Proposed Transaction")."

It further stated that the Board would notify shareholders of any new developments in due course without explaining the SEC's rejection. 

Recall that in September 2023, PZ Cussons (Holding) Limited, a UK-based company, announced plans to purchase minority shareholders' remaining 26.73 percent of PZ Cussons Nigeria Limited, its Nigerian subsidiary, for N21 per unit.

As a result of this action, PZ Cussons Nigeria shares were removed from the NGX market.

However, the offer price was rejected by the shareholders, who felt it was inappropriate for the minority shareholders. In November, after considering it, the Company raised the offer from N21 per share to N23 per unit.

PZ Cussons Nigeria posted a pre-tax loss of N73.8 billion in its H1 2024 results, a significant decline from the N9.3 billion pre-tax profit posted in the previous fiscal year's corresponding period.

Back Story
The board of PZ Cussons Nigeria Plc has called for an extraordinary general meeting (EGM) of its shareholders following the company's N73.8 billion loss that brought the firm's net assets to a critical state.

The company announced this in the notice it filed with the Nigerian Exchange Limited on Tuesday. The EGM, scheduled to be held soon, will have shareholders deliberating over the unaudited financial statement for the period ending November 30, 2023, and looking for measures to discuss the company's negative net asset value.

In September 2023, PZ Cussons announced plans to buy the 26.73% of shares held by minority investors at N21 per unit and move to delist the company from the Nigerian Stock Exchange (NGX). However, the company buyout price has since been increased to N23 per share.

The explanatory note that came alongside the notice of the EGM said that the company's unaudited interim financial statements for Q2 2023/2024 showed that it had fallen into a negative net asset position.