GlaxoSmithKline Consumer Nigeria Plc, the publicly traded local unit of the U.K.’s biggest drugmaker, gained the most in more than three weeks as the parent company said it plans to buy more of the shares.
The stock advanced 5 percent to 39.38 naira at the 2:30 p.m. close in Lagos, the commercial capital, the most since Nov. 1 on a closing basis. About 339,000 shares traded, 65 percent of the three-month daily average volume, according to data compiled by Bloomberg.
GlaxoSmithKline Plc agreed with its Nigerian unit to expand its holding from 46.4 percent to 80 percent, it said in a statement. The U.K. company will buy about 321 million shares at 48 naira a share, for a total of 15.4 billion naira ($98 million) The London-based drugmaker is also buying shares in its Indian consumer-products unit, boosting stakes in businesses that are growing faster than branded pharmaceuticals.
“It will definitely have an impact on the performance of the share price,” Pabina Yinkere, head of research at Lagos-based Vetiva Capital Management Ltd., said by phone today. “It is a low-hanging fruit for investors and the important thing for speculative investors is to cash in on the offer.”
Consumer health-care sales have been rising 21 percent a year over the past four years in Nigeria, Africa’s most populous country of over 160 million people and biggest oil producer, according to GlaxoSmithKline.
The Nigerian company’s shares have surged 71 percent this year, compared with 27 percent for the Nigerian Stock Exchange All-Share Index.