Cadbury Nigeria shareholders okay $7.7mn debt to equity swap

Cadbury Nigeria has announced plans to convert a $7.7 million loan owed to its majority shareholder, Cadbury Schweppes Overseas, to equity, following approval by shareholders at an extraordinary General Meeting. Oyeyimika Adeboye, the Managing Director of Cadbury Nigeria, shed light on the long journey that led to this pivotal decision. Adeboye highlighted the challenges faced by companies operating in Nigeria, including soaring inflation, foreign currency risks, devaluation, and high input costs escalating due to energy and raw material prices. In response to these challenges, Cadbury Nigeria has adopted a strategic approach focusing on localization of inputs, developing alternative local ingredients, and collaborating with international partners in a bid to cushion the impact of economic headwinds. Adeboye emphasized the importance of staying resilient amidst a challenging operating environment, emphasizing the need for strategic decision-making to navigate the turbulent economic landscape. The company's decision to convert the debt to equity stemmed from a need to manage cash flow effectively, while ensuring operational sustainability amid volatile market conditions. Adeboye underscored the significance of the move in maintaining confidence and dispelling concerns about multinational exits from Nigeria, portraying it as a vote of confidence in the local economy. The debt conversion process is underway, with regulatory approvals being sought to finalize the transaction within the current quarter. Looking ahead to 2023, Adeboye acknowledged the daunting task ahead for companies in the sector, with a focus on revenue generation and cost management strategies. Despite facing pricing challenges and volume constraints, Cadbury Nigeria has implemented revenue growth management initiatives to sustain its market position. Adeboye highlighted the resilience of the company's key segments, particularly in the face of FX losses and global commodity challenges. The dairy and cocoa segments, essential to Cadbury's product portfolio, faced pressures due to global market dynamics. As the company navigates the uncertainties of the market, Adeboye emphasized a key theme for the year ahead: focus. With a steadfast commitment to driving growth and managing operational challenges, Cadbury Nigeria remains resolute in its mission to navigate the evolving economic landscape with diligence and determination.