Wrap Text
Simplification of corporate structure
Mondi Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1967/013038/06)
JSE share code: MND ISIN: ZAE000156550
Mondi plc
(Incorporated in England and Wales)
(Registered number: 6209386)
LEI: 213800LOZA69QFDC9N34
JSE share code: MNP ISIN: GB00B1CRLC47
LSE share code: MNDI
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART,
DIRECTLY OR INDIRECTLY, IN, INTO OR FROM THE UNITED STATES OR ANY OTHER
JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT
LAWS OF THAT JURISDICTION
As part of the dual listed company structure, Mondi Limited and Mondi
plc (together ‘Mondi Group’, the ‘Group’ or ‘Mondi’) notify both the JSE
Limited and the London Stock Exchange of matters required to be
disclosed under the Listings Requirements of the JSE Limited and/or the
Disclosure Guidance and Transparency and Listing Rules of the United
Kingdom Listing Authority.
This announcement contains inside information.
19 November 2018
Simplification of corporate structure
The Boards of Mondi plc and Mondi Limited (the “Boards”) announce that
they are proposing to simplify the existing Mondi Group structure from
the current dual listed company structure ("DLC") into a single holding
company structure under Mondi plc. Mondi plc will continue to have a
premium listing on the London Stock Exchange (“LSE”) and will have an
inward secondary listing on the Johannesburg Stock Exchange (“JSE”)
quoted in rand.
The simplification will be implemented by way of a South African scheme
of arrangement whereby Mondi plc will acquire Mondi Limited. Mondi
Limited shareholders will receive one new Mondi plc share in exchange
for each Mondi Limited share held. Following the simplification, each
Mondi plc shareholder will have the same voting and capital interests in
the Group as each Mondi Limited and Mondi plc shareholder currently has.
Since its formation in 2007, Mondi has been an integrated corporate
group established under a DLC structure with dual holding companies,
Mondi plc, listed on the LSE with a secondary listing on the JSE holding
the non-South African interests of the Group, and Mondi Limited, listed
on the JSE holding the South African interests of the Group. Operating
as a combined group, Mondi is governed by complex arrangements to
maintain parity between the economic and voting rights of the Mondi plc
and Mondi Limited shareholders. At the time of formation, this structure
reflected the fact that the majority of Mondi's business was located in
Europe, whilst recognising Mondi's South African heritage and its
significant ongoing operations in the country. The shares in Mondi plc
and Mondi Limited currently represent approximately 76% and 24%,
respectively, of the Mondi Group’s combined ordinary share capital.
Mondi has achieved very strong profit growth since listing and, as the
Group has evolved, its non-South African interests have grown faster
than its South African interests, reflecting the relative scale of
opportunities in the respective markets. Today, over 90% of the Group's
underlying earnings are generated outside South Africa. This results in
an imbalance between the share of the Group dividend Mondi Limited is
required to support (approximately 24%) and the contribution of Mondi
Limited to Mondi’s profit available for distribution. The proposal will
simplify cash and dividend flows.
Mondi remains fully committed to South Africa with the South African
operations being an important part of Mondi, contributing to the Group’s
industry leading performance. Streamlining the corporate structure will
facilitate continued investment in the South African operations,
estimated at over R8 billion over the next five years, including the
ongoing investment in forestry assets and modernisation of the Group’s
pulp, containerboard, and paper assets.
The simplification will also enhance strategic flexibility, increase
transparency and remove the complexity associated with the current
structure. The simplification will not result in any changes to the
management, operations, locations, activities or staffing levels of the
Mondi Group.
Mondi has received written approval from the Minister of Finance through
the South African Reserve Bank (“SARB”) to simplify the existing Mondi
Group structure and to operate under Mondi plc as a single holding
company.
Mondi plc will continue to be incorporated in the UK and will remain UK
tax resident. Mondi Limited will remain incorporated and tax resident in
South Africa and will become a subsidiary of Mondi plc. Mondi plc will
continue to have a pound sterling quote on the LSE and will have an
inward secondary listing on the JSE quoted in rand. Dividends will
continue to be declared in euros. Shareholders holding Mondi plc shares
on the JSE will continue to receive payment in rand. The Group’s
dividend policy remains unchanged.
Mondi plc shares will continue to be included in the FTSE 100 index.
Today Mondi Limited shares are not eligible for inclusion in the FTSE
100 index. Following the issue of Mondi plc shares in exchange for Mondi
Limited shares as a result of the simplification, it is expected that
Mondi plc's weighting in the FTSE 100 index will increase. Mondi plc
shares are expected to continue to be eligible for inclusion in the key
JSE indices.
The simplification is not expected to have any significant impact on the
reported profits or net assets of the business.
The simplification is subject to certain conditions, including, among
other things, the approval of the shareholders of Mondi plc and Mondi
Limited. A shareholder circular, scheme document and prospectus are
expected to be made available to shareholders in the first half of 2019,
with implementation of the simplification currently expected in the
second half of 2019.
Peter Oswald, Chief Executive of Mondi, commented, "Mondi has delivered
a strong track record of value accretive growth since listing. While we
have successfully operated as a DLC to date, the evolution of the Group
since its formation in 2007 means that we need to consider the
appropriate structure for the future. The proposed simplification is a
natural step to remove the complexities around our structure and make
our corporate framework more efficient. Our South African operations
remain important to the Group and the proposed simplification
facilitates the modernisation of our Richards Bay mill and ongoing
capital expenditure in South Africa. Our strategy of delivering value
accretive growth focused around innovative and sustainable packaging and
paper solutions remains unchanged".
Further details will be announced in due course.
Contact details:
Mondi Group
Andrew King +44 193 282 6321
Group CFO
Clara Valera +44 193 282 6357
Group Head of Strategy and
Investor Relations
Kerry Cooper +44 193 282 6323
Senior Manager – External
Communication
FTI Consulting
Richard Mountain +44 790 968 4466
Financial Adviser and Corporate Broker – UBS Limited
Anna Richardson Brown +44 207 568 8360
Gary Hudson +27 11 322 7641
About Mondi
Mondi is a global leader in packaging and paper, delighting its
customers and consumers with innovative and sustainable packaging and
paper solutions. Mondi is fully integrated across the packaging and
paper value chain - from managing forests and producing pulp, paper and
plastic films, to developing and manufacturing effective industrial and
consumer packaging solutions. Sustainability is embedded in everything
Mondi does. In 2017, Mondi had revenues of €7.10 billion and underlying
EBITDA of €1.48 billion.
Mondi has a dual listed company structure, with a primary listing on the
JSE Limited for Mondi Limited under the ticker MND, and a premium
listing on the London Stock Exchange for Mondi plc, under the ticker
MNDI. Mondi is a FTSE 100 constituent, and has been included in the
FTSE4Good Index Series since 2008 and the FTSE/JSE Responsible
Investment Index Series since 2007.
Sponsor in South Africa: UBS South Africa Proprietary Limited.
Important Information
This document does not constitute or form part of any offer or
invitation to sell or issue, or any solicitation of any offer to
purchase or subscribe for, any shares or any other securities, nor shall
it (or any part of it), or the fact of its distribution, form the basis
of, or be relied on in connection with, any contract therefore.
This announcement is not for distribution, directly or indirectly, in or
into the United States (including its territories and possessions, any
State of the United States and the District of Columbia), Australia,
Canada or Japan. This announcement does not constitute or form a part of
any offer or solicitation to purchase or subscribe for securities in the
United States, Australia, Canada or Japan. The securities mentioned
herein (the “Shares”) have not been, and will not be, registered under
the United States Securities Act of 1933 (the “Securities Act”). The
Shares may not be offered or sold in the United States except pursuant
to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. There will be no public
offer of securities in the United States, Australia, Canada and Japan.
Forward-Looking Statements
All statements other than statements of historical fact included in this
announcement are or may be forward-looking statements. Forward-looking
statements include but are not limited to statements containing words
such as “seek”, “expect”, “anticipate”, “estimate”, “believe”, “intend”,
“project”, “plan”, “strategy”, “forecast” and similar expressions or
future or conditional verbs such as “will”, “would”, “should”, “could”,
“may” and “might.” These statements reflect the Group’s current
expectations, beliefs, hopes, intentions or strategies regarding the
future and assumptions in light of currently available information. Such
forward-looking statements are not guarantees of future performance or
events and involve known and unknown risks and uncertainties.
Accordingly, actual results may differ materially from those described
in such forward-looking statements. The forward-looking statements
contained in this announcement speak only as of the date of this
announcement and the Group does not assume or undertake any obligation
or responsibility to update any of the forward-looking statements
contained in this announcement, whether as a result of new information,
future events or otherwise, except to the extent legally required.
UBS Limited (“UBS”) is authorised by the Prudential Regulation Authority
and regulated by the Financial Conduct Authority and the Prudential
Regulation Authority in the United Kingdom. UBS is acting exclusively
for Mondi and no one else in connection with the matters referred to in
this announcement.
Date: 19/11/2018 05:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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