Quality Chemical Industries has dropped the Cipla name in a process that signals completion of a 51.18 percent share purchase by Africa Capitalworks.
The purchase process has been ongoing since April last year with purchase completion deadlines pushed several times due to delayed approvals.
“Quality Chemical wishes to notify shareholders and the public of its change of name from Cipla Quality Chemical Industries to Quality Chemical Industries, effective February 15, 2024,” Mr Emmanuel Katongole, the chairman and co-founder of Quality Chemical Industries, noted in a corporate notice.
Quality Chemical Industries is the producer of antiretrovirals and anti-malarial medicines.
Cipla, which held a 51.18 percent in Quality Chemical, wholly exited the drug manufacturer to focus on larger markets after failure to realise anticipated revenues from the local drug maker.
The shares were purchased by equity firm, Africa Capitalworks, which had previously held an 8 percent stake in Quality Chemical, but had withdrawn from the company following its September 2018 initial public offering.
Quality Chemical has had challenges in the last five years ever since listing on the Uganda Security Exchange, where its stock price has fallen from the IPO price of Sh256.5 to just Sh52.5 due to weak sales.
However, some investment experts have shown optimism in the stock, noting that Quality Chemical has the capacity to post better returns due to a rich and wide product portfolio. “It already has some capacity internally to produce drugs and that’s what initially attracted Cipla to invest in it. There has been a lot of technological transfer from Cipla and this is likely to continue. Quality Chemical has also built networks for sales, which are likely to continue,” Mr Simon Mwebaze, the Old Mutual Investment Group managing director, said.
Details indicate that Quality Chemical continues to experience mixed performance with profits before tax slightly falling from Shs18.6b in 2022 to Shs17.1b in 2023. Last week company announced a dividend pay-out of Shs1.6 per share.
