Nigeria’s and West Africa’s online retail pharmacy – HealthPlus, is going through a boardroom and shareholder squabble, that threatens the operations of the company. The battle for ownership of the company is now between Alta Semper, a private equity investor in the company, and Bukky George, the company’s founder, and CEO.
The dispute attracted media attention after a press release was issued, announcing Chidi Okoro as Chief Transformation Officer of the company. In a press release seen by Nairametrics, the ‘company’ reported that Mr. Okoro’s “mission is to optimize day-to-day management, and elevate the business to novel scale and profitability,” effectively removing the founder, Mrs. Bukky George, as MD/CEO.
This press release set off a chain of online and social media mudslinging, that has had both sides court public sympathy for who is in control of the company. Mrs. Bukky George issued a counter press release, denying that she had been removed as MD/CEO. According to her side of the story, she claimed the press release was not authorized by the company and termed it false.
“We wish to inform the General Public, the Pharmacists Council of Nigeria, our Staff, loyal Customers, Vendors, Landlords, Bankers, and all Stakeholders that the press release was NOT authorized by the company or anybody acting on its behalf, and that the announcement of the appointment of a CTO is wholly FALSE.”
Alta Semper on the other hand maintains, “The majority of the Board of Directors of the Company, determined that a change of leadership was required if HealthPlus was to achieve its strategic goals, and the former CEO’s appointment was terminated in accordance with its terms.”
Reliable sources informed Nairametrics that several attempts from both sides to resolve the matter have failed, due to a disagreement on the terms and conditions for the injection of capital into the company. We understand that HealthPlus is going through financial challenges, and is in dire need of capital to remain in operations.
What are they saying?
Alta Semper, in a follow-up press release, alleges that the decision to remove Mrs. Bukky George “was made in full compliance with Nigerian laws, and follows a long and drawn-out process of engagement,” through which the Board sought to address multiple issues with the way the company was being managed.
- They claim that this was after a series of “significant breaches of the terms,” of Mrs. George’s engagement as CEO of the company.
- That the “board had explored a range of options that would enable her to continue to play an alternate leadership role,” but she rejected such an arrangement. However, they did not mention what they meant by ‘an alternate leadership role’ in the company.
- They explained that it “became clear that an amicable resolution was not going to be possible. and as the multiple issues persisted, urgent action was required to avoid adverse impact on the entire business, including customers, employees, suppliers, and other key stakeholders.”
- They also claim that despite the ‘former CEO’ not achieving the target they set for her, they had sought to provide financial support for HealthPlus through ‘growth capital.’
- However, “Mrs. George has not only refused to agree to offers of additional investment on commercially reasonable terms, but attempted to force ASC to restructure the existing binding contracts governing their relationship agreements, which she readily signed in 2018, after taking independent legal and financial advice.”
- Alta Semper also maintains that despite removing Bukky George as CEO, she remains a director of the company, while its appointee Chidi Okoro, oversees the day-to-day operations of the company.
- It believes this is necessary for the benefit of all stakeholders and as a result, “the majority of the Board of Directors of the Company determined that a change of leadership was required, if HealthPlus was to achieve its strategic goals, and the former CEO’s appointment was terminated in accordance with its terms.”
Bukky George issued a press release alleging that the appointment of Chidi Okoro was not authorized by the company or anybody acting on its behalf.
- She claims that the appointment of Chidi Okoro as CTO is wholly false, wrongful, illegal, and should be totally ignored.
- She also claims “it was the handiwork of unscrupulous foreign, local businesswomen, and businessmen’s intent on reaping where they have not sown, simply because they now see opportunities from the COVID-19 pandemic, like scavengers and vultures.”
- Bukky George alleges that Health Plus ran into “troubled waters primarily,” because Alta Semper failed to take over the company, thus starving it of funds required to operate.
- She also alleges that Alta Semper has an obligation to fund HealthPlus, in line with its agreements.
- She mentions that in May 2020, she instituted a legal action at the Federal High Court, seeking to stop HealthPlus African Holdings Limited, from continuing to run and manage the company “in an oppressive and prejudicial manner, and in total disregard of her interest as a member of the company,” which she ostensibly founded.
- She further cites withholding of funds, meddling with management, interference with the functions of key employees, abuse of corporate governance processes, and attempt to remove her as CEO, as what she wanted the court to stop.
- She affirmed that there is a restraining order against Alta Semper.
A. Muoka: In a leaked letter seen by Nairametrics, A. Muoka & Co, the solicitors to the company, wrote to Messrs. Afsane Jetha and Zachary Fond, the directors in HealthPlus, and also representatives of Alta Semper on the termination of the management agreement between Alta Semper and Bukky George.
- They claim that as solicitors to the company, any attempt to remove Bukky George is a flagrant disregard of the court’s order, as also claimed by Bukky George.
- They opined that the Board of Directors are the only ones empowered to remove Mrs. George as CEO. However, the board’s Chairman, Dr. Ayo Salami, and Mr. Deji Akinyanju had resigned from the board, meaning only two directors took the decision rather than 5.
- According to A. Mouka, the agreement required that Alta Semper and Bukky George appoint two directors each, and jointly agree on a Chairman for the company.
- The lawyers thus claim that because the board was depleted, the decision to remove Bukky George was “Male Fide’ (in bad faith), as Mrs. George was not given an opportunity to respond to the weighty allegations made against her, some of which are criminal in nature.
What we know so far
While both sides continue to issue several statements of denials and claims, here is what we have learned so far about the partnership.
- In April 2018, Nairametrics reported that London-based private equity manager, Alta Semper Capital agreed to invest US$18 million into HealthPlus. The investment vehicle used was HealthPlus Africa Holdings Ltd, which is incorporated in Mauritius.
- Alta Semper is a private equity manager founded by Ronald Lauder, (Chairman of Clinique Laboratories, a subsidiary of the Estée Lauder Company, and a former US ambassador to Austria), Richard Parsons (Chairman of Rockefeller Foundation, former Chairman of Citigroup and Chairman/CEO of Time Warner Group), and Afsane Jetha.
- The new funding was to enable the company to expand its retail footprint and enhance its competitive position.
- It had approximately 80 locations across the country at the time and currently has about 90 branches.
- HealthPlus Ltd is owned by HealthPlus Africa Holdings Ltd, with a 94,998 ownership, while Bukky George owns 5,002 shares; thus, 94.9% ownership and 5.1% ownership respectively.
- Nairametrics understands that Bukky George owns less than 50% of HealthPlus Africa Holdings, while Alta Semper owns majority shares in the holding company, estimated at between 53% and 55%.
- Sources inform Nairametrics that HealthPlus makes about N5 billion in revenue annually.
CAP Plc set to merge with Portland Paints and Products Plc.
CAP Plc and Portland Paints have taken a decision to merge their respective businesses in accordance with applicable laws.
The Board of Directors of Chemical and Allied Products Plc (CAP Plc), and Portland Paints and Products Plc (Portland Paints), have decided to merge their respective businesses in accordance with applicable laws to drive growth and expansion within the Nigerian and African markets.
This is according to a press release signed by Bolarin Okunowo, the Managing Director of Portland Paints, made available on NSE, Monday, 26th October 2020.
The completion of the proposed merger is subject to approvals being obtained from the Federal Competition and Consumer Protection Commission, the Securities and Exchange Commission (SEC), The Nigerian Stock Exchange (NSE), the Federal High Court, as well as shareholders of CAP and Portland Paints.
What you should know
- Should the proposed merger go ahead, CAP Plc will emerge as the resultant entity.
- The proposed merger will be executed by way of a Scheme of Merger (the “Scheme”) in accordance with Section 711 of the Companies and Allied Matters Act, 2020, and other applicable laws, rules, and regulations.
- The Scheme will involve the transfer of all Portland Paints Plc’s assets, liabilities and business undertakings including real property and intellectual property rights to CAP Plc.
- In consideration for the transfer, CAP Plc is offering shareholders of Portland Paints a choice to receive N2.90 cash for every Portland Paints share held OR 1 new ordinary share of CAP Plc, credited as fully paid up for every 8 Portland Paints shares held.
- The proposed consideration represents a 45% premium to the last traded share price of Portland Paints Plc on October 16, 2020, being the last business day prior to the date on which CAP Plc sent its merger proposal to the Board of Portland Paints and a 41% premium on the trading price as at close of trading on October 23, 2020.
What they are saying
Commenting on the proposed merger, David Wright, Managing Director of CAP, said, “The decision to pursue the proposed merger, is driven by the Board’s strategic plan to aggressively grow within the Nigerian and African markets.
“We believe that the Proposed Merger presents a unique opportunity that will benefit all stakeholders, from shareholders to customers, as well as the broader economy. I am excited by the prospect of an enlarged company with a broader decorative paint portfolio covering the premium, mid-market and affordable segments and the inclusion of marine and protective coatings, all of which will benefit our customers and shareholders.”
The Managing Director of Portland Paints, Bolarin Okunowo, submitted that “In recent months, the Board and Management of Portland Paints have evaluated various strategic options with a view to positioning our company to capture emerging growth opportunities.
“CAP Plc’s business is complementary to ours, and both companies will be better able to serve our respective customers by coming together. I believe the combination of Portland Paints and CAP will yield significant benefits for all of our stakeholders.”
Portland Paints and Products Nigeria Plc – with 85.98% of the company’s issued share capital owned by UAC Nigeria Plc, manufactures and sells decorative, industrial, and marine/protective coatings for the construction of oil & gas industries in Nigeria. Portland Paints is the Nigerian representative of Hempel. It is listed on the NSE.
Chemical and Allied Products Plc (CAP) – a subsidiary of UAC Nigeria Plc – which holds 51.49% of the company’s shares, manufactures and sells premium and standard paints and coatings, and is the sole technological licensee of Akzo Nobel Coatings International B.V. in Nigeria. It is listed on the NSE.
Paystack acquired by Stripe for a reported $200 million in the biggest fintech acquisition in Nigeria’s history
Nigerian fintech startup, Paystack has been acquired by global fintech giant, Stripe.
PayStack, a Nigerian fintech startup, has been acquired by global fintech giant Stripe, in the biggest M&A deal in Nigerian tech and one of the biggest in Nigerian corporate history. Paystack was founded in 2016 by Ezra Olubi and Shola Akinlade.
This was disclosed in a press release seen by Nairametrics. The statement read in part:
“In order to help grow Africa’s online GDP, Stripe has entered into an agreement to acquire Paystack, a technology company based in Lagos that makes it easy for organizations of all sizes to collect payments from around the world.
“Today, more than 60,000 businesses in Nigeria and Ghana use Paystack to securely collect online and offline payments, launch new business models, and deepen customer relationships.
“Incredibly, Paystack already processes more than half of all online transactions in Nigeria.
Paystack has ambitious plans to expand across the continent and recently started a pilot with businesses in South Africa.
“Stripe and Paystack have been working closely together for some time. In 2018, Stripe led Paystack’s Series. A financing round and has provided ongoing guidance as the company rapidly scaled.”
Following the announcement, TechCrunch on Thursday afternoon reported that Stripe had raised $600 million to invest and acquire payments companies in developing nations. It disclosed that the Nigerian startup had been on Stripe’s bucket list for a while since 2018 when Stripe led an $8 million funding round for PayStack.
Paystack Co-founder Sola Akinlade told TechCrunch that the company was not up for sale when Stripe initially approached for the acquisition; however, the founders are mission-driven and believed Stripe could accelerate it. Akinlade also disclosed PayStack investors, VISA and Tencent also approached to acquire the company.
“Paystack was not for sale when Stripe approached us.
“For us, it’s about the mission. I’m driven by the mission to accelerate payments on the continent, and I am convinced that Stripe will help us get there faster. It is a very natural move,” Akinlade said.
Nairametrics reported in 2016 when Paystack raised its initial $1.3 Million Seed Funding from both international and homegrown investors.
Founders Ezra Olubi and Shola Akinlade were the toast of the tech space when their company became the first Nigerian tech startup to be accepted into the world-famous Y Combinator program, based in Silicon Valley. They obtained an initial $120,000 seed funding and further technical advice at the program.
What they are saying
Patrick Collison, CEO of Stripe, told TC that the deal with PayStack is an enormous opportunity, as African e-commerce grows by 30% every year, which would give Stripe an early footing in the region.
“This is an enormous opportunity,” he said.
“In absolute numbers, Africa may be smaller right now than other regions, but online commerce will grow about 30% every year. And even with wider global declines, online shoppers are growing twice as fast.
“Stripe thinks on a longer time horizon than others, because we are an infrastructure company. We are thinking of what the world will look like in 2040-2050.”
He added that Stripe is also planning on understanding the ecosystem and keep its eyes open so it can see where help is needed, as the company does not tie up its investments into “complicated strategic investments.”
Collison said that many companies depend on Stripe’s infrastructure, but with PayStack, the founders have organic input in running their operations.
Stripe said the announcement of the acquisition was delayed due to the #EndSARS protests across the country.
“A lot of companies have been, let’s say, heavily influenced by Stripe.
“But with Paystack, clearly they’ve put a lot of original thinking into how to do things better. There are some details of Stripe that we consider mistakes, but we can see that Paystack ‘gets it’. It’s clear from the site and from the product sensibilities, and that has nothing to do with them being in Africa or African.”
Shola Akinlade said the payments ecosystem is still broken and PayStack is still in its early days. PayStack provides payments API for companies and takes a cut from every transaction. The company has 60,000 customers so far, from SMEs to large cooperation,s and would continue to run independently.
Techcrunch said the full terms of the deal were not disclosed. However, TC confirmed that it is worth over $200 million, making it the largest tech acquisition in Nigerian corporate history.
What you should know
According to Crunchbase, PayStack has raised $11.7 million so far.
London Stock Exchange seals $5billion Borsa Italiana sale
The sale is aimed at dousing tensions amidst growing concerns over LSE control of the European Bond market.
In what appears to be a landmark trade deal, the London Stock Exchange (LSE) has agreed to a €4.3 billion ($5.1 billion) with Euronext to sell Borsa Italiana. This is according to insider sources from both firms.
If successful, the deal would bring LSE a step closer to clinching approval for its $27 billion purchase of Refinitiv, which is 45% owned by Thomas Reuters. The sale is aimed at dousing tensions amidst growing concerns over LSE control of the European Bond market.
This is corroborated in a statement by London Stock Exchange Chief Executive, David Schwimmer, “We believe the sale of the Borsa Italiana group will contribute significantly to addressing the EU’s competition concerns,”
Recall earlier that LSE had entered exclusive talks with Euronext last month after the Paris bourse owner saw off competition from Deutsche Boerse DB1Gn.DE and Swiss rival SIX. The deal presents an opportunity for Euronext to expand its equity operations, while it presents an opportunity for LSE to recoup the €1.6.
The deal will afford Euronext the opportunity to commence its first fixed income training via Borsa’s bond trading platform MTS.
Commenting on the deal, the CEO of Euronext, Stephane Boujnah said “Euronext will significantly diversify its revenue mix and its geographical footprint by welcoming the market infrastructure of Italy, a G7 country and the third-largest economy in Europe.”
How will the deal be funded?
Euronext with a market value of around 7 billion euros, might not be able to pull an outright cash deal without a sizeable amount of debt instruments. Hence, the firm plans to issue 1.8 billion euros in debt and raise 2.4 billion euros in new equity to fund it.
To raise funds and specifically secure the Italian government’s support, Euronext collaborated with state agency Cassa Depositi e Prestiti (CDP) and Italy’s biggest bank Intesa SanPaolo, who will subscribe to 700 million euros of Euronext’s equity issue.