Huggies Diaper Maker to Exit Nigeria Over Toxic Operating Environment

By Adedapo Adesanya

Kimberly-Clark, makers of the Huggies brand of diapers, is shutting Nigerian operations two years after it relaunched a $100 million manufacturing facility in Ikorodu in the commercial hub of Lagos.

Kimberly-Clark began operations in Nigeria in 2012 but stopped due to unfavourable economic conditions after five years in 2019 to later restart in 2021. 

The company produces Huggies diapers, sanitary pads, Kotex and other hygiene and personal care products. KC is a listed multinational on the New York Stock Exchange with the majority of its shares held by institutional investors like Blackrock Inc., Vanguard Group, Morgan Stanley etc. 

According to reports, the company cited the country’s toxic operating environment as the major factor pushing it out of Nigeria, adding that there was a shift in its strategic priorities globally.

It was gathered that the plant has been producing below capacity from late 2023 into 2024 and as such, it has become economically injurious to remain in business.

The development comes as more than 15 multinational companies, including Procter & Gamble, GlaxoSmithKline (GSK) and others announced an exit from Nigeria between last year and May this year. A move that resulted in over 2,000 job losses.

Recall that the  Manufacturing Association of Nigeria (MAN) in February indicated that about 767 manufacturing companies shut down operations in Nigeria in 2023. In addition, the association noted that another 335 companies were in distress financially in the same year.

But the Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, said the government of President Bola Tinubu was not responsible for the economic conditions that led to the shutdown of the companies in 2023.

He, however, said the government was already looking at the issues that led to the exit of the organisations.

In his words, “The new environment which investors face is one in which inflation is being attacked which will eventually lead to lower interest rates where investors can use the very vibrant domestic market to add their equities and invest.”