At the 63rd Annual General Meeting (AGM) of Neimeth International Pharmaceuticals PLC held recently in Lagos, shareholders approved plans to raise N5 billion through hybrid Offer of Rights to existing shareholders and private placement in the company. The money, according to the board will be used to finance major long-term projects and boost production.
To achieve this, shareholders approved the creation of 2,373,947,500 additional ordinary shares to be allotted at the rate of five new shares for every four currently held in the company.
The shareholders also approved to raise equity capital of N1.32 billion by way of private placement at the premium price of N2.10 kobo for 628,753,036 ordinary shares.
Commenting on the development, Chairman of the Board, Dr. Ambrosie Orjiako, said the money will be used for three reasons: the construction of a world class factory that is compliant to World Health Organisation (WHO) current standards of Good Manufacturing Practice (cGMP) at Amawbia in Anambra State; the completion of ongoing facility upgrade at the company’s Oregun factory and to boost working capital.
Orjiako informed that on completion, the Oregun plant alone will add additional 300 per cent to the company’s production capacity, noting that these projects will not only sustain the current upbeat performance of the company, but will also give her a quantum leap into the league of leading global health care commodities producers.
He disclosed that the company’s board is working to ensure that the growth trajectory of the company is not only sustained, but enhanced beyond what has been accomplished in the last four years of consistent growth in turnover and profitability.
The Managing Director/CEO, Matthew Azoji, noted that the capital market is the most viable and cheaper option, adding that Neimeth cannot finance long-term projects with short-term funds from banks, saying such decision is not expedient and cost effective.
He said: “We did not want to put the entire burden of N5 billion on shareholders, that is why we have decided to add private placement to the fund raise.”
