The planned delisting of prominent companies including GlaxoSmithKline (GSK) Plc, PZ Cusson Plc, Oando Plc, Coronation Insurance Plc, and Capital Hotel Plc from the Nigerian Exchange Limited (NGX) will result in a significant reduction of approximately N205.002 billion from the equities market capitalization. This move follows Ardova Plc’s delisting in July 2023, which led to a reduction of N21.49 billion in market capitalization.
Key Points:
- GlaxoSmithKline (GSK) Plc, which announced its intention to cease operations in Nigeria, is expected to account for a market value reduction of N15.49 billion.
- PZ Cusson Plc, planning to buy out minority shareholders and subsequently delist, currently holds a market capitalization of N79.41 billion.
- Oando Plc, with a market value of N87.02 billion, has decided to delist due to longstanding legal disputes with minority shareholders over ownership interests.
- Coronation Insurance Plc, receiving an offer for shares acquisition and delisting, holds a market capitalization of N14.4 billion.
- Capital Hotel Plc, with a market value of N8.692 billion, aims to delist to explore strategic opportunities, alliances, and collaborations.
Analysis: The proposed delisting of these major companies signifies strategic shifts in their operational models, corporate structure, or ownership. Each company appears to be pursuing its unique reasons for delisting, ranging from simplification of operations to exploring new strategic opportunities. While this move may lead to a reduction in the NGX’s market capitalization, it reflects the dynamic nature of the equities market and the companies that comprise it.
Background:
- The delisting of GlaxoSmithKline (GSK) Plc is attributed to factors including challenges with foreign exchange availability and losses incurred due to Naira devaluation.
- PZ Cusson Plc’s planned buy-out and subsequent delisting aim to simplify and strengthen operations.