07 Apr 11 Mondi plans to spin off South African packaging business
Mondi Group has unveiled a plan to spin off its South African packaging operations to give both businesses the flexibility to pursue different opportunities. Mondi Packaging South Africa (MPSA) produces a variety of paper and plastic packaging products used across the South African food and drinks industry including bottles, fast food containers, cereal boxes and fruit boxes.
Last year, it achieved revenues of R5.7 billion (€591 million). But Mondi believes that the South African business could grow that figure better as a separate entity.
The company said that MPSA’s long term growth plans, particularly with respect to its rigid plastics business, are currently constrained by the different strategic focus of the overall group.
David Hathorn, CEO of Mondi Group, said: “Whilst Mondi Group has been a very supportive owner, this move will give MPSA the flexibility it needs to develop its core growth areas.
“MPSA is unique within the Group as no other part of Mondi produces rigid plastics or cartonboard and therefore the Board felt that MPSA would be best placed to take advantage of the considerable opportunities available to it as an independent entity.”
Under the financial plans set out by Mondi today, MPSA will be listed under a new name on the Johannesburg Stock Exchange.
The demerger and some of the financial details around it require various third party approvals and are also subject to the approval of shareholders.
Further details on the proposed demerger will be released in May, including MPSA’s pre-listing statement.