Neimeth International Pharmaceuticals has secured shareholder approval to raise fresh capital and clean up its balance sheet, a move that sent its shares climbing for a third straight day.
At its annual general meeting on Monday, the company’s board received the green light to raise as much as ₦20 billion through various options – ranging from a public offer to private placement.
The company did not state what the funds would be used for in its regulatory notice on Wednesday.
The drug maker is also restructuring its finances to wipe out years of accumulated losses. Shareholders approved a plan to reassign ₦2 billion from the company’s share premium account to offset these losses.
The amount will be credited to a capital restructuring reserve, which will be used to write off the company’s ₦2.75 billion in accumulated losses as of March 2025.
The move still requires court approval, but it signals a turning point for the company, which has been weighed down by debt and operational costs.
Market Reaction
The news triggered immediate market optimism. Neimeth’s stock rallied nearly 9.84% to N4.91 in early trading Wednesday, continuing a run that began earlier in the week.
The bounce also follows improved financial performance in the first quarter(Q1) of 2025, with Neimeth posting a profit of ₦115.76 million, up from ₦77.65 million in the previous quarter amid rising finance costs, administrative expenses, and high cost of sales.
As of Q1, Neimeth’s total assets stood at ₦12.4 billion, with liabilities of ₦10.6 billion. The company has a share capital of ₦2.1 billion, and the planned capital raise could significantly boost its solvency and fund future growth.
Founded over six decades ago, Neimeth has long been a recognized name in Nigeria’s healthcare space. But like many manufacturers, it has battled economic headwinds, including inflation, rising production costs, and currency instability.
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