(Alliance News) - Mondi PLC on Monday said it is withdrawing the disposal of its most significant facility in Russia due to lack of progress in gaining regulatory approvals in that country.
The Weybridge, England-based paper and packaging firm said its sale to Augment Investments Ltd involved JSC Mondi Syktyvkar, a pulp and paper mill.
Mondi entered into an agreement to sell the Syktyvkar mill for around EUR1.5 billion in August 2022. The disposal was conditional on the approval of Russian government.
London- and Johannesburg-listed Mondi stressed on Monday that the proposed disposal of its three Russian packaging converting operations to Gotek Group, as announced on December 15, was excluded from the termination of the Syktyvkar deal.
The sale of these packaging converting operations, it said, remained in progress.
"As per the terms of the sale and purchase agreement, the disposal to Augment will therefore be terminated and will not complete," Mondi said, citing lack of progress in gaining the necessary approvals.
The group said it remained committed to divesting Syktyvkar and will continue to assess all alternative sale options.
Shares in Mondi shed 3.3% to ZAR302.93 on Monday in Johannesburg. In London, the stock lost 3.1% to 1,251.00 pence.
By Artwell Dlamini, Alliance News reporter
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Mondi (MNDI)