PZ Cussons Sinks as Attempt to Take Out Minority Shareholders Failed
Investors are selling their shares in PZ Cussons Plc after Securities Exchange Commission, SEC, rejected majority shareholder’s offer to buy out non-controlling interest at N23.
At the end of third quarter of 2024, the company has negative equity balance of N46.42 billion. This was due to accumulated losses of more than N51.344 billion. Its huge capital depreciation suggest that the company would require shareholders to inject additional funds.
In 9 months of financial year 2024 results, PZ Cussons reported N58.916 billion as net loss. The earnings broke as a result of a spike in forex loss sustained by revaluation of its foreign currency liabilities on its balance sheet.
Data from the Nigerian Exchange revealed that the company’s market value declined by 10% last week as equities investors continue to take another route to investing destinations.
PZ Cussons Plc listed shares have seen successive price decline over the past few weeks amidst unimpressive earnings performance and lower expectations about the company future earnings growth.
In March, PZ Cussons majority shareholders PZ Cussons (Holdings) Limited sought to buyout shares of its minority or non-controlling interest. Its major investors sought to take the company private with buyout of shares.
Recently, its majority share offered to buy each share held by shareholders without significant control at N23. However, the company said Nigeria’s investment regulator, SEC, rejected the offer.
The company which is struggling to keep its head high amidst tough operating condition has lost significant value due to broken earnings performance.
It share price fell to N19.50 on Friday, down by 10% from N22 at the beginning of the previous week. PZ Cussons is currently trading less than 50% of its 52 week high.
Its share price had peaked at N40 in the stock market during a good time. Its worst price score over the last 52 week was N16.20. #PZ Cussons Sinks as Attempt to Take Out Minority Shareholders Failed
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