Mondi PLC to change current dual-listed company structure into single

() is changing its current dual-listed company structure into a single holding company structure in London.

The FTSE 100-listed paper and packaging group said it will continue to have a premium listing on the London Stock Exchange and will have an inward secondary listing on the Johannesburg Stock Exchange quoted in rand.

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The firm said the simplification will be implemented by way of a South African scheme of arrangement whereby 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.

The shares in Mondi PLC and Mondi Limited currently represent approximately 76% and 24%, respectively, of the Mondi Group’s combined ordinary share capital.

Non-South African interests have grown faster

Mondi pointed out that its non-South African interests have grown faster than its South African interests, reflecting the relative scale of opportunities in the respective markets, with over 90% of the group’s underlying earnings now generated outside South Africa.

The group said this results in an imbalance between the share of the group dividend Mondi Limited is required to support and the contribution of Mondi Limited to Mondi’s profit available for distribution. The proposal will simplify cash and dividend flows.

Mondi said it remains fully committed to South Africa with the South African operations and said it has received written approval from the Minister of Finance through the South African Reserve Bank to simplify the existing Mondi Group structure.

As as a result of the simplification, it is expected that Mondi PLC’s weighting in the FTSE 100 index will increase.

The group said the simplification is not expected to have any significant impact on the reported profits or net assets of the business.

Peter Oswald, Mondi’s chief executive commented: “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.”