Mondi (MNDI) M&A Announcement summary

Deal rationale and strategic fit

• Expands corrugated packaging footprint in Western Europe, adding over one billion square meters of capacity and highly complementary assets, including two advanced mega-box plants in Germany.

• Aligns with strategy to invest in cost-advantaged, integrated assets and strengthens position in Germany, the largest packaging market in Europe.

• Enhances offering for e-commerce and FMCG customers with complementary fibre-based and sustainable packaging solutions.

• Solid board business provides a niche, integrated position, especially for e-commerce packaging.

• Enhances integration with containerboard operations, supporting a broader product portfolio and e-commerce packaging range.

Financial terms and conditions

• Enterprise value of €634 million, financed from existing facilities, maintaining a strong financial position.

• 2023 adjusted EBITDA of acquired assets was €66 million.

• Transaction is expected to be earnings per share accretive in the first full financial year post-completion.

• Depreciation expected to be around €40 million, pending final acquisition accounting.

• Recent expansion at Greven site cost over €100 million and is now fully operational.

Synergies and expected cost savings

• €22 million in cost synergies expected by end of year three, mainly from procurement, cost optimization, and vertical integration.

• One-off cash costs to achieve synergies estimated at approximately €18 million.

• Synergies are hard cost, not reliant on plant closures, and will be realized over three years.

• Strong upside potential through synergies and improved capacity utilization.