The Federal High Court has granted an order sanctioning the merger between Chemical and Allied Products Plc (CAP Plc) and Portland Paints and Products Nigeria Plc, effective from 1st of July, 2021.
This is according to a disclosure signed by the Managing Director of Portland Paints, Bolarin Okunowo and sent to the Nigerian Exchange Group Limited (NGX).
The merger is sequel to the approval granted at the respective court-ordered meetings of Portland Paints and CAP held on 18th of February, 2021. In light of this, the Federal High Court of Nigeria on 29th of June, 2021 granted the approval to proceed with the merger of the aforementioned firms.
Affirming this, a part of the recent notice read: ‘’ Portland Paints and Products Nigeria PLC (“Portland Paints”) hereby notifies Nigerian Exchange Limited (the “Exchange”), our shareholders and the general public that following the approval of the scheme of merger between Portland Paints and Chemical and Allied Products Plc (“CAP”) (the “Merger”) at the respective court-ordered meetings of Portland Paints and CAP held on February 18, 2021, the Federal High Court of Nigeria, on June 29, 2021, granted an order sanctioning the Merger. The Merger will become effective on Thursday, July 1, 2021 (the “Effective Date”).’’
Mr. Okunowo noted that subject to the approval of the Exchange, the shares of Portland Paints will be placed on full suspension a day before the effective date, that is, from the close of business on 30th of June, 2021. This is to enable the company update its register of members for the purpose of determining the shareholders eligible to receive the scheme consideration.
What this means:
By the virtue of the merger, it is imperative to note that CAP and Portland Paints will from the effective date (today) operate as one entity, with CAP being the surviving enlarged entity. Portland Paints will be dissolved without being wound up.
In addition, the merger provides a unique opportunity to help drive growth and expansion within the Nigerian paints and coatings landscape, creating more value for shareholders and relevant stakeholders.
Finally, the merger is expected to create an ‘’Enlarged CAP’’ which will dominate the Nigerian paints market, printing the industry’s largest market share estimated to be around 14.9%. The enlarged entity will float an enlarged product portfolio with strong brands and a rich product mix of CAP and Portland Paints in the standard, premium, industrial and marine/protective segments.
What you should know:
- To effectively conclude the deal, Nairametrics had earlier reported that CAP Plc had been authorized to receive all the assets, liabilities, product offerings and property rights of Portland Paints and Products Nigeria Plc.
- In view of the merger, CAP Plc was authorized to pay cash consideration of N2.90 to the Scheme shareholders for each ordinary share of N0.50 held in Portland Paints as at close of business on the terminal date.
