Mondi and DS Smith reach agreement in principle on merger, extend PUSU deadline

Packaging giants Mondi and DS Smith have reached an agreement in principle on the key financial terms of a possible all share offer by Mondi for DS Smith.

Mondi would then acquire the entire issued and to be issued share capital of DS Smith, the companies announced on 7 March.

Mondi shareholders would own 54 per cent and DS Smith shareholders 46 per cent of the issued and to be issued share capital of Mondi. The price per DS Smith share would be £3.73, which represents a premium of 33 per cent to DS Smith's closing share price from 7 February 2024, according to the statement.

The expanded group will be continued to be led by its current management with Andrew King as the CEO, Mike Powell as CFO and Philip Yea as Chair. Three Non-Executive Directors of DS Smith are expected to join the board.

However, this agreement does not constitute a firm take-over bid. DS Smith has requested to extend the PUSU deadline to 4 April 2024 5 pm GMT. Until then, both companies will continue discussions on other terms and conditions and look into the realisation of possible synergies, it is further stated.

The combination would create a pan-European industry leader in paper-based packaging solutions with sales revenues in excess of €17bn (DS Smith £8,2bn, Mondi €7.3bn) and complementary geographic footprints. Mondi has more than 22,000 employees at 100 production sites. DS Smith has 30,000 employees and operates in 30 countries.

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