Azoji: N5bn Offer Will Position Neimeth as Leading Global Healthcare Commodities Producer

Kayode Tokede

The Managing Director/CEO, Neimeth International Pharmaceuticals Plc, Matthew Azoji has stated that the proposed N5billion capital raising offers through rights issue and private placement will take Neimeth to the league of leading global healthcare commodities producers. 

Speaking at a press briefing in Lagos, he noted that the money raised is to fund strategic expansion plans of the company in Lagos and Anambra States.

According to him, “We are seeking a total of N5 billion of investors’ funds through a hybrid Offer of Rights Issue and Private Placement. We want to raise N3.7 billion and N1.3 billion respectively from both Offer.

“The money is being raised to fund our strategic expansion plans. Last year, at the 62nd Annual General Meeting of the company, our shareholders approved a two-pronged expansion plan, namely the construction of a new plant in Anambra State and a facility upgrade of the Oregun plant.

“The new plant will be a multi-product facility that will be tailored to comply with the World Health Organization (WHO) current standards of Good Manufacturing Practice (cGMP) at Amawbia in Anambra State.”

He added, “Part of the funds will also be used to support the company’s strategic plan of maintaining a sustainable capital structure, leverage the company’s balance sheet, reduce cost of borrowing or finance costs and fund working capital. The Oregun factory upgrade is already close to completion with funds from the Bank of Industry (BOI) and own resources.

“On completion, the Oregun plant alone will add additional 300 per cent to the Company’s production capacity especially with liquid preparations. These projects will not only sustain the current upbeat performance of the company but will give us a quantum leap into the league of leading global healthcare commodities producers.   I am optimistic that Neimeth shareholders will take their rights in the Rights Issue and   the offer will be fully subscribed.”

The Rights Issue that commenced August 3, 2022 aimed to raise the sum of N3,679,618,625 at the cost of N1.55k per 50 Kobo share.  

To carry out the Rights Issue, the Company had in March 2022, created 2,373,947,500 additional Ordinary Shares, which will be allotted at the rate of five new shares for every four shares currently held in the company to existing Shareholders.

He added that the company returned to dividend payment in 2020 and is determined to remain consistent amid increase in the amount payable to shareholders every year.

He said, “For instance, Neimeth increased dividend payout by eight per cent to 7.0 kobo/share for the 2021 business year, sustaining the trend started in 2020 when the company paid a dividend per share of 6.5 Kobo; after it had earlier successfully used its profit to restructure its balance sheet and counterbalanced earlier losses. 

“Beyond cash dividend payouts; shareholders of Neimeth have seen significant capital gains as the investing public continued to react positively to the improvements in the company’s fundamentals. The share price of Neimeth increased from 40 kobo as at September 30, 2019 to N1.75 by the   end of our last   business year on September 30, 2021, representing a 338 per cent gain, more than an average of 100 per cent gain per annum. This implies that a shareholder who had N1 million worth of shares on September 30, 2019 has seen its value rise to N4.75 million. The trend has remained largely the same in 2022.”