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Thanks. I thought you meant recent, since the Mondi deal hit the news.
RNS Number : 9537V
Smith (DS) PLC
07 December 2023
Where did you heart that? There's been no RNS.
Even if he is going it may nt mean the deal is done, just that he and the rest of the board have different views on the deal.
Im guessing that the deal is done! CEO is going.
Only a guess on my part but the move up in the share price today might suggest there's progress in discussions between SMDS and Mondi.
Looking at the SKG-WestRock deal and how the WestRock share price travelled at the time suggests something around the 25% premium for us, puts us somewhere around the 370-380p which is only where we were a few years ago, hard to judge given current relative low valuations for UK equities. I wonder if there's a possibility of interest from US companies, and whether that, allied with the current low valuations and the done deal between SKG-WestRock spurs MNDI to get a deal quickly.
So take over or merger , which share were you better off holding before this announcement, not just today , but eventual outcome?
I own DS smith and bdev
"If D S Smith shareholders are given share in Mondi, that's a take over. If shareholders of each get shares in a new entity , that's a merger."
My view is that if the board of directors of the resulting company is mainly ex-Mondi BoD then it's a takeover. If it's more evenly matched then it's a merger.
Look at the proposed "merger" of BDEV and RDW. Only one exec and two non-execs from RDW make it into the new board or directors. It's a takeover.
If D S Smith shareholders are given share in Mondi, that's a take over. If shareholders of each get shares in a new entity , that's a merger.
Mondi was looking to buy us out in feb 2021 when our share price was around 380 ish ? Got a feeling they been watching & waiting for many years & now is they time to get the deal done? What will bid is the question ? 375 to 400 ? Wil I buy more 2moro why not as it could be a nicer little earner in a short space of time GLA
£4 is only 30% more than we are now. They will have to convince shareholders to the rationale behind the merger to get it done. Smiths were hardly struggling.
Surprised this hasn’t gone higher today. I’m tempted to top up but already have too many. Genuinely think this is a really good opportunity for folks though. This company has been overlooked for years, and is way too cheap.
Agreed Meconopsis. Think we could see some modest movement higher but not going to be challenging 400
Mondi talks about a "combination" :)
SMDS market cap is £4b (ish); Mondi is £6b (ish).
Morningstar suggests that SMDS is trading on a 16% discount to fair value vs 2% for Mondi.
That would appear to cap any premium for an all share merger at 20-25%. You'd expect a higher premium if it was a cash offer.
Thoughts?
Correct the share price was higher in late December than it finished today. And there has been no company specific news to change its valuation.
If Mondi do bid it will be an all share offer, so not £, but Mondi shares,. So if a deal is sorted and looks OK, but then the Mondi share price goes down, so does what we eventually get.
Hopefully the board are good negotiators. I wouldn't want anything below 350, and would really hope for something above 400, but I don't know eve4rything the board knows, so I'll have to trust their judgement!
If nothing else it livens things up for the next few days.
This is a merger and not a takeover, correct? Both companies are of similar size.