The Lemon Fool

daveh wrote:Mondi have now made an announcement:

If it goes ahead it will be an all-share offer.

https://www.investegate.co.uk/announcem ... n-/8029271

atement Regarding Possible All Share Combination With DS Smith Plc
Mondi plc ("Mondi") notes the recent announcement by DS Smith plc ("DS Smith").

Mondi confirms that it is in the early stages of considering a possible all share combination with DS Smith.

Mondi routinely considers various options within its disciplined capital allocation framework aimed at accelerating its growth in the structurally growing packaging sectors in which it operates.

Mondi believes that a possible all share combination with DS Smith represents an exciting opportunity to create an industry leader in European paper-based sustainable packaging solutions:

well positioned to benefit from structural growth trends in sustainable packaging;
benefitting from enhanced vertical integration, bringing with it a balanced paper position, greater earnings resilience through the cycle and enhanced security of paper supply, for the benefit of both shareholders and customers; and
benefitting from substantial synergies as a result of vertical integration alongside highly complementary positions and expertise in containerboard, corrugated solutions and flexible packaging, in addition to expected benefits from economies of scale and efficiencies across a combined supply chain and administration.

Not an especially sparkling verdict so far from Mr Market. As far as I can see, neither Mondi nor DS Smith have set the house on fire with share price appreciation. I hold some SMDS and will probably sell out since I don't really want shares in Mondi. Probably going to sell and buy a vanilla IT.

BullDog wrote:Not an especially sparkling verdict so far from Mr Market. As far as I can see, neither Mondi nor DS Smith have set the house on fire with share price appreciation. I hold some SMDS and will probably sell out since I don't really want shares in Mondi. Probably going to sell and buy a vanilla IT.

I sold my SMDS shares yesterday much for the reason you've mentioned.

Ian.

idpickering wrote:

BullDog wrote:Not an especially sparkling verdict so far from Mr Market. As far as I can see, neither Mondi nor DS Smith have set the house on fire with share price appreciation. I hold some SMDS and will probably sell out since I don't really want shares in Mondi. Probably going to sell and buy a vanilla IT.

I sold my SMDS shares yesterday much for the reason you've mentioned.

Ian.

I don't follow the logic of selling because you don't want mondi shares. Because if a real offer gets put on the table, the SMDS share price is likely to go up before the deal is completed.

MrFoolish wrote:

idpickering wrote:
I sold my SMDS shares yesterday much for the reason you've mentioned.

Ian.

I don't follow the logic of selling because you don't want mondi shares. Because if a real offer gets put on the table, the SMDS share price is likely to go up before the deal is completed.

I didn't sell yesterday. But my trigger finger is ready. Obviously SMDS is in play and I hope another bidder for the company emerges. I haven't done so yet but I'll probably place a sell order at a price I'm happy with and wait to see what happens.

BullDog wrote:

MrFoolish wrote:
I don't follow the logic of selling because you don't want mondi shares. Because if a real offer gets put on the table, the SMDS share price is likely to go up before the deal is completed.

I didn't sell yesterday. But my trigger finger is ready. Obviously SMDS is in play and I hope another bidder for the company emerges. I haven't done so yet but I'll probably place a sell order at a price I'm happy with and wait to see what happens.

I'm retaining my SMDS holding in my ISA as I actually like the company and think it is undervalued. I'll wait and see what happens on the bid front and if an all share deal goes ahead with Mondi will decide at the time whether to retain Mondi shares or sell in advance of the deal. I've not looked at Mondi in any detail yet, but they do seem to listed on the FTSE.

There was a Financial Times article on the deal yesterday (google served it up on my phone)
https://www.ft.com/content/55ffcf39-c4a ... 12b456e48a but its almost certainly behind a paywall, suggesting the two companies were a good fit and also suggesting there might be a counter bid from another big packaging player wanting a larger European footprint. So I'm happy to hold and wait and see what happens and hope a deal will bring a much better price. If no deal is forthcoming I'm still happy to hold SMDS and collect the dividends.

Its more what to do with my much smaller unsheltered holding, I'm planning on selling that sometime before April for tax planning reasons and it was whether too pull the trigger yesterday or wait and see if a better price appears between now and April due to the takeover rumours. It's dropped back a bit today to 308 (it hit 318 yesterday) and is still well off the 1 year high of 367. So I think I'll wait and see what happens.

I'll continue to hold to see how the takeover offer unfolds. Have in my SIPP for growth and in my ISA for the dividend. Less than 5% holding in both so not that significant.

From newspaper talk they seem a good fit with Mondi. If the takeover goes through I'll probably sell from my ISA as Mondi dividend below my threshold for holding in my ISA and keep Mondi in my SIPP.

Crazbe7

I hold both, I usually do nothing. If anything comes to pass and I end up with a larger than planned holding of Mondi I'll probably continue to do nothing. I will enjoy having a little think about it before I continue to do nothing. In the short term I'll collect the special from Mondi. As a pessimist I expect I'll lose SMDS, have an outsized holding in Mondi yet less overall income than before the process.

25 RNSs released by DS Smith today about share holdings. What's going on, relates to Mondi possible bid next week?

BullDog wrote:25 RNSs released by DS Smith today about share holdings. What's going on, relates to Mondi possible bid next week?

Too late for me to edit. There's a load of similar RNSs today by Mondi.

Fireworks at SMDS on Monday?

BullDog wrote:

BullDog wrote:25 RNSs released by DS Smith today about share holdings. What's going on, relates to Mondi possible bid next week?

Too late for me to edit. There's a load of similar RNSs today by Mondi.

Fireworks at SMDS on Monday?

According to the news item on HL it's already "surged" 11.7%. They love such language, but not a lot has happened if you take the longer view. My experience with take-overs is that it's rather rare to make a profit, because no company gets taken over until the price has fallen so much that I'm always well under water.

Arb.

Arborbridge wrote:

BullDog wrote:Too late for me to edit. There's a load of similar RNSs today by Mondi.

Fireworks at SMDS on Monday?

According to the news item on HL it's already "surged" 11.7%. They love such language, but not a lot has happened if you take the longer view. My experience with take-overs is that it's rather rare to make a profit, because no company gets taken over until the price has fallen so much that I'm always well under water.

Arb.

Fair comment. Though where HL calculated the "surge" from I don't know. SMDS still significantly below 52 week high which is disappointing. Fortunately, this is one situation where I am showing a decent profit. Plus the dividends I've banked while waiting for something to happen. I would be delighted with 400p from Mondi. But that might be too tall an ask. We'll see.

BullDog wrote:

Arborbridge wrote:
According to the news item on HL it's already "surged" 11.7%. They love such language, but not a lot has happened if you take the longer view. My experience with take-overs is that it's rather rare to make a profit, because no company gets taken over until the price has fallen so much that I'm always well under water.

Arb.

Fair comment. Though where HL calculated the "surge" from I don't know. SMDS still significantly below 52 week high which is disappointing. Fortunately, this is one situation where I am showing a decent profit. Plus the dividends I've banked while waiting for something to happen. I would be delighted with 400p from Mondi. But that might be too tall an ask. We'll see.

I need to get to 350p - so there's a chance. Why didn't I top up more at lower prices? No idea at this distance, but I guess it just didn't rise near enough to the top on account of the reduced yield and divi payments. Or there were always better candidates. Such is life.

Evening All.

I just checked - my SMDS average purchase price is £2.7938. So, not looking too bad with some decent dividend income since as well.

MNDI is less exciting for me - average purchase price £14.1048, so about the same as now. It's also had the decent dividend income, of course.

Regards, Newroad

Newroad wrote:Evening All.

I just checked - my SMDS average purchase price is £2.7938. So, not looking too bad with some decent dividend income since as well.

MNDI is less exciting for me - average purchase price £14.1048, so about the same as now. It's also had the decent dividend income, of course.

Regards, Newroad

I haven't checked, but my guess is that I'm around the same ballpark with SMDS. I don't want Mondi shares so one way or another it seems I'll be disposing of my DS Smith shares soon.

I bought Mondi not so long ago, already had SMDS from an age ago, I bought before the 2008 cut and was delighted at the income growth once we got over that interruption. I've had my money back several times over. DO I want more Mondi, not really thought about that yet. Let's see.

Hi BullDog.

But what would it be replaced with?

In my eleven sector methodology, next cab off the rank is SKG (3.86% dividend yield) but that is more of the same, in broad terms.

If I took an executive decision to bypass that, the next would be DCC (3.37% dividend yield) another Irish company.

Regards, Newroad

Newroad wrote:Hi BullDog.

But what would it be replaced with?

In my eleven sector methodology, next cab off the rank is SKG (3.86% dividend yield) but that is more of the same, in broad terms.

If I took an executive decision to bypass that, the next would be DCC (3.37% dividend yield) another Irish company.

Regards, Newroad

Not totally decided what I will buy with proceeds of a SMDS sale. Almost certainly a vanilla investment trust. But I'll be thinking about it between now and next week.

BullDog wrote:25 RNSs released by DS Smith today about share holdings. What's going on, relates to Mondi possible bid next week?

When a company is the subject of a takeover bid, you always find many RNS posts about changing shareholdings. I think that the Stock Exchange rules require them.

TJH

tjh290633 wrote:

BullDog wrote:25 RNSs released by DS Smith today about share holdings. What's going on, relates to Mondi possible bid next week?

When a company is the subject of a takeover bid, you always find many RNS posts about changing shareholdings. I think that the Stock Exchange rules require them.

TJH

Thanks, indeed it does. The notable thing here, for me at least, is 25 RNSs all released around the same time by many institutional investors appearing at both companies. That's a fair chunk of DS Smith shares sold by a fair number of institutional investors apparently to Mondi. On the Friday before the week in which the bid has to be confirmed or not by Mondi. So, far from routine share holdings changing hands, in my humble opinion. And more indicative of what is perhaps on the cards for SMDS share holders next week. We shall soon see.

There's an increased offer from Mondi for DS Smith on the table according to several news outlets. Presumably we'll get to know what's what soon.