| Fri 1 Jun 2007, 12:01 | | MND/MNP - Mondi Limited/Mondi plc - Abridged pre-l |
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JSE
MND MNP
MND/MNP - Mondi Limited/Mondi plc - Abridged pre-listing statement
Mondi Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1967/013038/06)
JSE share code: MND & ISIN: ZAE000097051
("MLTD")
Mondi plc
(Incorporated in England and Wales)
(Registration number: 6209386)
JSE share code: MNP & ISIN: GB00B1CRLC47
("MPLC")
Abridged pre-listing statement
Introduction
Mondi Limited and Mondi plc, collectively the Mondi Group ("Mondi"), today
announce the posting of their prospectus (the "Prospectus") along with the
Anglo American plc ("Anglo American") circular (the "Circular") to Anglo
American shareholders in relation to the Mondi demerger from Anglo American
and the listing of the ordinary issued share capital on the JSE Limited
("JSE") and London Stock Exchange (the "Demerger").
The Demerger will result in Mondi being held by way of a dual listed
company structure ("DLC Structure"), comprising MLTD, a South African
incorporated company holding Mondi`s African assets, and MPLC, a UK
incorporated company holding Mondi`s non African assets.
If the Demerger becomes effective, holders of ordinary shares in Anglo
American (the "Anglo American Shareholders") will receive both ordinary
shares in MLTD ("MLTD Ordinary Shares") and ordinary shares in MPLC ("MPLC
Ordinary Shares") in proportion to their holdings of existing ordinary
shares in Anglo American ("Existing Anglo American Ordinary Shares"), which
they will continue to hold. Following the Demerger, Mondi and Anglo
American will operate independently of each other as separately listed and
publicly traded companies.
The Business of Mondi
Mondi is an integrated paper and packaging group with sales of Euro5,751
million in 2006. Its key operations and interests are in Western Europe,
Emerging Europe and South Africa. Mondi is principally involved in the
manufacture of packaging paper, converted packaging products (including
corrugated packaging, bags and flexible packaging) and office paper. In
addition, it has merchant operations which focus on Austria and Emerging
Europe and newsprint operations in South Africa, the United Kingdom and
Russia.
Mondi is integrated across the paper and packaging production process from
the growing of wood for pulp production and the manufacture of pulp and
paper to the conversion of packaging papers into corrugated packaging and
industrial bags. Furthermore, it has a growing flexibles business focused
on the production of release liner, extrusion coating and consumer
flexibles products.
Mondi has production operations in 112 locations across 34 countries. Mondi
averaged approximately 34,000 employees during 2006.
Background to and reasons for the Demerger
From its founding by the Anglo American group in South Africa in 1967, and
its subsequent expansion into Europe during the 1990s, Mondi has grown to
become a leading integrated paper and packaging group.
In October 2005, the Board of Directors of Anglo American announced that it
had undertaken a major strategic review of its business that would lead to
a rationalisation and simplification of its portfolio, with an increased
focus on Anglo American`s controlled mining businesses. Following this
review, Anglo American announced in February 2006 its plans to list Mondi
on the London Stock Exchange and, on 21 February 2007, it announced that
approval in principle had been received from the regulatory authorities in
South Africa to demerge Anglo American`s interests in Mondi through a DLC
Structure.
The Directors of Anglo American believe the proposed separation of Mondi
from Anglo American reflects the different characteristics of Mondi`s paper
and packaging business and Anglo American`s mining businesses. The Demerger
will allow Anglo American and Mondi to pursue the independent strategies
that best meet their respective long-term objectives. Additionally, the
Demerger should ensure that the value of Mondi`s business is more fully
recognised by the market as investors are better able to assess its
attributes. The Demerger will also enable Anglo American Shareholders to
participate more directly in Mondi`s future development should they choose
to do so.
Summary of the Demerger and Anglo American Share Consolidation
A number of steps are required to give effect to the Demerger and the
creation of the DLC Structure. Accordingly, the proposals of the Anglo
American Board of Directors (the "Proposals") involve:
* amendments to Anglo American`s articles of association in order to
allow the payment of a dividend in specie and to facilitate the
Demerger and an Anglo American Ordinary Share consolidation;
* an Anglo American dividend in specie to effect the first stage of the
Demerger, resulting in Anglo American Shareholders receiving MPLC
Ordinary Shares (pro rata to their holdings in Anglo American and on a
one for one basis);
* a MPLC reduction of capital reducing the nominal value of each MPLC
Ordinary Share from Euro2.00 to Euro0.05 resulting in the transfer of
MLTD Ordinary Shares to holders of MPLC Ordinary Shares (pro rata to
their holdings in Anglo American and, in relation to their holdings in
MPLC Ordinary Shares, on a one for ten basis);
* a share consolidation of the MPLC Ordinary Shares received by Anglo
American Shareholders (on a one for four basis) thereby increasing the
nominal value of each MPLC Ordinary Share from Euro0.05 to Euro0.20;
the various agreements and structures establishing the DLC Structure
coming into effect; and
* a share consolidation of Existing Anglo American Ordinary Shares to
create new ordinary shares in Anglo American ("New Anglo American
Ordinary Shares").
Assuming that the Proposals become effective, subject to rounding down of
the fractional entitlements to New Anglo American Ordinary Shares, MLTD
Ordinary Shares and MPLC Ordinary Shares, Anglo American Shareholders will
receive for every 100 Existing Anglo American Ordinary Shares held:
(i) 91 New Anglo American Ordinary Shares,
(ii) 10 MLTD Ordinary Shares; and
(iii) 25 MPLC Ordinary Shares.
Immediately following implementation of the Proposals, the aggregate number
of issued MLTD Ordinary Shares and the aggregate number of issued MPLC
Ordinary Shares will be in the ratio of 2:5.
The individual entitlements of Anglo American Shareholders (other than
South African shareholders holding dematerialised shares ("SA
Dematerialised Shareholders")) will be calculated by reference to their
holdings of Existing Anglo American Ordinary Shares on the Register at the
Record Time, being 12.01 a.m. on Monday, 2 July 2007 and individual
entitlements of SA Dematerialised Shareholders will be calculated by
reference to their holdings at the JSE Record Time, being 5.00 p.m. (South
African time) on Friday, 6 July 2007.
Key Features of the DLC Structure
The Mondi Group will be held by MLTD and MPLC, which will be separate
entities with separate stock exchange listings. Anglo American
Shareholders will receive shares in each of these entities upon
implementation of the Demerger, and will have the ability (as will
investors generally) to buy and sell shares in these companies
independently. However, the agreements to which each of the holding
companies will be party will effectively create a single economic group.
1 Separate entities and listings
The JSE has granted a primary listing to MLTD by way of an introduction of
the entire issued ordinary share capital of MLTD, in the "Basic Resources -
Forestry and Paper", sector of the JSE List. The JSE has also granted a
secondary listing by way of introduction of the entire issued ordinary
share capital of MPLC in the "Basic Resources - Forestry and Paper" sector
of the JSE List. Application has been made to the FSA for the MPLC Ordinary
Shares to be admitted to the Official List and to the London Stock Exchange
and for all of the MPLC Ordinary Shares to be admitted to trading on the
London Stock Exchange`s market for listed securities.
2 Holdings of MLTD Ordinary Shares and MPLC Ordinary Shares
Following implementation of the DLC Structure, any ordinary share held in
either MLTD or MPLC gives the holder an equivalent effective economic
interest in Mondi (see below for details).
3 Unified boards and management
Mondi will operate as a single corporate group. As MLTD and MPLC will be
separate corporate entities, they will each continue to have a board of
directors, but the MLTD Board and MPLC Board will comprise the same
directors. The MLTD Board and the MPLC Board will, in addition to their
duties to the company concerned, have regard to the interests of both the
holders of MLTD Ordinary Shares ("MLTD Shareholders") and holders of MPLC
Ordinary Shares ("MPLC Shareholders") as if the two companies were a single
economic enterprise.
4 Equivalent economic interests
Both MLTD Ordinary Shareholders and MPLC Ordinary Shareholders will have
equivalent economic and voting interests in Mondi. The economic and voting
interests represented by an ordinary share in one company relative to the
economic and voting interests of an ordinary share in the other company
will be determined by reference to a ratio known as the "Equalisation
Ratio".
Following the Demerger, the economic and voting interests attached to each
MLTD Ordinary Share and each MPLC Ordinary Share will be the same, on the
basis that the initial Equalisation Ratio will be 1:1.
5 Voting arrangements
Under the terms of the DLC Agreements, the Articles of Association of MLTD
and the Articles of Association of MPLC, special voting arrangements are in
place so that the shareholders of both companies effectively vote together
as a single decision-making body on matters affecting the shareholders of
each company in similar ways ("Joint Electorate Actions"). For so long as
the Equalisation Ratio remains 1:1, each MLTD Ordinary Share will
effectively have the same voting rights as each MPLC Ordinary Share on
Joint Electorate Actions.
6 Cross guarantees
On implementation of the DLC Structure, MLTD and MPLC will each execute a
Deed Poll Guarantee as a result of which it is anticipated that both MLTD
and MPLC will share the same credit rating. Creditors of MLTD and MPLC
entitled to the benefit of the Deed Poll Guarantees will, to the extent
possible, be placed in the same position as if the relevant debts were owed
by Mondi.
7 Restrictions on takeovers of one company only
The Articles of Association of MLTD and the Articles of Association of MPLC
ensure that a person cannot gain control of one company without having made
an equivalent offer to the shareholders of both companies on equivalent
terms.
Dividend Policy
Following the Demerger, Mondi intends to pursue a dividend policy that
reflects its strategy of disciplined and value creating investment and
growth with the aim of offering its shareholders long term dividend growth.
The Directors intend that the final and interim dividends will generally be
paid in May and September in the approximate proportions of two-thirds
(final dividend) and one-third (interim dividend). The Directors intend
that Mondi will pay an interim dividend in September 2007, in the absence
of unforeseen circumstances, with respect to the six-month period to 30
June 2007.
Mondi will target a dividend cover range of two to three times on average
over the cycle, although the payout ratio in each year will vary in
accordance with the business cycle and will be subject to Mondi having
sufficient distributable reserves.
Debt Allocation
Mondi`s financing requirements, to the extent not financed out of cash
generated from operations, has historically been financed through a
combination of equity and debt. Debt has been provided from bank loans
made to Mondi and loans from Anglo American. On the date the Demerger
becomes effective, Mondi expects to have net debt of approximately Euro1.5
billion, of which approximately Euro0.9 billion will be owed to existing
external lenders to Mondi and the balance will be owed under a new Euro1.55
billion banking facility. Mondi intends to refinance all of its existing
debt to Anglo American at or shortly prior to completion of the Demerger
out of the new multi-currency revolving credit facility.
MLTD and MPLC Boards of Directors
Name Age Nationality Position
Sir John Parker 65 British Joint Chairman (Non-
executive director)
Cyril Ramaphosa 55 South African Joint Chairman (Non-
executive director)
David Hathorn 45 South African Chief Executive
and Austrian Officer (Executive
director)
Paul Hollingworth 47 British Chief Financial
Officer (Executive
director)
David Williams 61 British Senior Independent Non-
executive director
Colin Matthews 51 British and Independent Non-
Canadian executive director
Imogen Mkhize 45 South African Independent Non-
executive director
Anne Quinn 55 New Zealander Independent Non-
and Irish executive director
The business addresses of the directors listed above are 44 Main Street,
Johannesburg 2001, South Africa in the case of MLTD and Building 1, Aviator
Park, Station Road, Addlestone, Surrey KT15 2PG, United Kingdom in the case
of MPLC.
Expected Mondi Group Ordinary Share Capital upon Admission
Authorised Expected maximum issued and
fully paid or credited as
fully paid
Number Amount Number Amount
MPLC Euro Euro
ordinary 3,084,508,780 616,901,756.00 369,627,980 73,925,596.00
shares of
Euro0.20
each
MLTD 250,000,000 R50,000,000.00 147,851,192 R29,570,238.40
ordinary
shares of
R0.20 each
Expected Timetable
The notice convening an Extraordinary General Meeting of Anglo American for
4.00 p.m. (UK time) on Monday, 25 June 2007 at 20 Carlton House Terrace,
London, United Kingdom SW1Y 5AN, is set out in the Circular. At that
meeting, approval from the Anglo American Shareholders will be sought for
the Demerger and related Proposals. This will be followed by a Court
hearing at 10.00am on Monday 2, July 2007 to seek approval of the reduction
of capital of MPLC. On Monday 2 July 2007, MLTD Ordinary Shares and MPLC
Ordinary Shares will commence trading on the JSE on a conditional basis,
and MPLC Ordinary Shares will commence trading on the London Stock Exchange
on a conditional basis. It is expected that the Demerger will become
effective and the shares in MLTD and MPLC will be admitted and commence
unconditional trading on Tuesday, 3 July 2007.
Anglo American Shareholders on the Anglo American register of members at
12.01 a.m. on Monday, 2 July 2007 (other than SA Dematerialised
Shareholders) will receive 2 MLTD Ordinary Shares and 5 MPLC Ordinary
Shares for every 20 Existing Anglo American Ordinary Shares that they hold.
The entitlements of SA Dematerialised Shareholders will be calculated by
reference to their holdings of Existing Anglo American Ordinary Shares at
5.00 p.m. (South African time) on Friday, 6 July.
If the reduction of capital or Admission does not occur on Tuesday, 3 July
2007, all conditional dealings will be suspended. If it cannot be confirmed
that the reduction of capital and Admission will become effective on
Wednesday, 4 July 2007, all conditional dealings on Monday, 2 July 2007
will be of no effect. If the reduction of capital and Admission will not
become effective by Friday, 6 July 2007, Anglo American will acquire all
the MPLC Ordinary Shares and allot (by Monday, 9 July 2007) New Anglo
American Ordinary Shares to the MPLC Ordinary Shareholders instead.
Prospectus and Circular Distribution
Copies of the Prospectus and the Circular will be available on
www.mondidemerger.com from Friday, 1 June 2007. Copies of the Prospectus
may be obtained during normal business hours from Friday, 1 June 2007 until
Tuesday, 3 July 2007, both days inclusive, at the following addresses:
* the registered office of MLTD, 44 Main Street, Johannesburg, 2001,
South Africa;
* the registered office of MPLC, Building 1, Aviator Park, Station Road,
Addlestone, Surrey KT15 2PG, United Kingdom;
* the offices of UBS South Africa (Proprietary) Limited, 64 Wierda Road
East, Wierda Valley, Johannesburg, 2196, South Africa; and
* the offices of Anglo American plc, 20 Carlton House Terrace, London
SW1Y 5AN, United Kingdom.
1 June 2007
Advisers
Joint sponsors to MPLC in the UK: Goldman Sachs International and UBS
Limited
Sponsor to MLTD and MPLC on the JSE: UBS South Africa (Proprietary) Limited
Legal adviser to MPLC and MLTD as to English law: Linklaters LLP
Legal adviser to MPLC and MLTD as to South African law: Webber Wenzel
Bowens
Legal Adviser to the joint sponsors as to English law: Allen & Overy LLP
Auditors and reporting accountants: Deloitte & Touche LLP
Notes to the Editors
1 Upon the Demerger becoming effective, the Mondi Group will be held by
way of a dual listed company structure comprising MLTD and MPLC.
2 The JSE has granted a primary listing to MLTD by way of an
introduction of the entire issued ordinary share capital of MLTD, in
the "Basic Resources - Forestry and Paper", sector of the JSE List.
The JSE has also granted a secondary listing by way of introduction of
the entire issued ordinary share capital of MPLC in the "Basic
Resources - Forestry and Paper" sector of the JSE List. Application
has been made to the FSA for the MPLC Ordinary Shares to be admitted
to the Official List and to the London Stock Exchange and for all of
the MPLC Ordinary Shares to be admitted to trading on the London Stock
Exchange`s market for listed securities. MPLC will be included in the
"Forestry and Paper" sector of the London Stock Exchange List.
Unconditional dealings in MPLC Ordinary Shares on the London Stock
Exchange are expected to commence at 8.00 a.m. (UK time) on Tuesday, 3
July 2007. Unconditional dealings in MLTD Ordinary Shares and MPLC
Ordinary Shares on the JSE are expected to commence at 9.00 a.m.
(South African time) on Tuesday, 3 July 2007.
3 The Demerger is conditional upon, amongst other things, the approval
of resolutions by the Anglo American Shareholders at the Extraordinary
General Meeting of Anglo American to be held at 4.00 p.m. on Monday,
25 June 2007, and the approval of the reduction of capital by the
Court at the court hearing at 10.00 a.m. on Monday, 2 July 2007. (As
mentioned in the Circular, another of the conditions is the giving of
clearances by HM Revenue and Customs. At the time of printing the
Circular, the clearances already given on the basis of advanced
proposals for the Demerger were in the process of being refreshed to
reflect minor changes to the proposals. Updated clearances have now
been obtained.)
The information in this summary should be read in conjunction with the full
text of the Prospectus and Circular. Terms used in this press release but
not defined herein have the meaning given to them in the Prospectus.
This press release has been issued by and is the sole responsibility of
Mondi.
Goldman Sachs International which is regulated in the United Kingdom by the
FSA, UBS Limited and UBS South Africa (Proprietary) Limited are acting
exclusively for Anglo American and Mondi and no one else in connection with
the proposed Demerger and Admission and will not be responsible to anyone
else for providing the protections afforded to respective customers of
Goldman Sachs International, UBS Limited and UBS South Africa (Proprietary)
Limited or for providing advice in relation to the proposed Demerger and
Admission or the contents of this announcement.
This press release does not comprise listing particulars or a prospectus
relating to Mondi Limited, Mondi plc or Anglo American and does not
constitute an offer or invitation to purchase or subscribe for any
securities of Mondi or Anglo American and should not be relied on in
connection with a decision to purchase or subscribe for any such
securities. This press release does not constitute a recommendation
regarding the securities of Mondi or Anglo American and has been issued in
compliance with the Listings Requirements of the JSE.
This announcement does not constitute a recommendation concerning the
Demerger, and should not be construed as legal, business, tax or investment
advice. The value of shares can go down as well as up. Past performance is
not a guide to future performance. Anglo American Shareholders should
consult a professional adviser as to the suitability of the Demerger for
the individual concerned.
None of the MPLC Ordinary Shares, the MLTD ordinary Shares or the Anglo
American Ordinary Shares will be, or is required to be, registered under
the US Securities Act of 1933, as amended. None of the MPLC Ordinary
Shares, the MLTD Ordinary Shares or the Anglo American Ordinary Shares
referred to in this announcement have been approved or disapproved by the
US Securities and Exchange Commission, any state securities commission in
the United States or any other US regulatory authority, nor have such
authorities passed upon or determined the adequacy or accuracy of this
document. Any representation to the contrary is a criminal offence in the
United States.
The financial information concerning Mondi or Anglo American contained in
this announcement does not amount to statutory accounts within the meaning
of Section 240 of the UK Companies Act 1985.
Certain statements made in this announcement are forward looking
statements. Such statements are based on current expectations and are
subject to a number of risks and uncertainties that could cause actual
events or results to differ materially from any expected future events or
results referred to in these forward looking statements.
The distribution of this document in jurisdictions other than the United
Kingdom or the Republic of South Africa may be restricted by law and
therefore persons into whose possession this document comes should inform
themselves about and observe such restrictions. Any failure to comply with
these restrictions may constitute a violation of the securities laws of any
such jurisdiction.
THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF
AN OFFER TO BUY ANY SECURITY. NONE OF THE SECURITIES REFERRED TO IN THIS
DOCUMENT SHALL BE SOLD, ISSUED OR TRANSFERRED IN ANY JURISDICTION IN
CONTRAVENTION OF APPLICABLE LAW.
Date: 01/06/2007 12:01:01 Produced by the JSE SENS Department.
