Mpact said yesterday it has been informed by the Competition Commission that Caxton and CTP Publishers and Printers had not been granted a merger notification that would pave a way for it to acquire Mpact. Photo: Antoine de Ras/African News Agency (ANA)
MPACT said yesterday it has been informed by the Competition Commission that Caxton and CTP Publishers and Printers had not been granted a merger notification that would pave a way for it to acquire Mpact.
This comes after Caxton informed the commission at the end of last month that it wanted to increase its stake from 32 percent to a majority controlling stake in Africa’s largest paper and plastics packaging business.
Caxton also notified the commission that it sought to obtain merger approval in terms of the Competition Act in advance of triggering the mandatory offer in order to obtain regulatory certainty and to avoid any unnecessary delays in the implementation of the mandatory offer.
However, Mpact informed its shareholders yesterday that the Competition Commission had not granted Caxton permission at this stage.
“Shareholders are advised that the commission has since informed Mpact that after the commission’s consideration of Caxton’s application for permission to file a separate merger notification, the commission is of the view that the application is premature and it is therefore unable to grant permission at this stage,” Mpact said.
Mpact said it would inform shareholders of any material developments in this regard as and when appropriate.
Mpact also released a second trading update for the six months to end June, in which it expects a surge in earnings. The group said in a revised trading statement that it expects earnings per share (Eps), headline earnings per share (Heps) and underlying Eps to be between 118 cents a share and 123c, compared to the Eps and underlying Eps of 9c and Heps of 8.4c reported last year. In the first trading statement, released at the end June, the group forecast earnings to be more than 90c.
Revenue for the first five months was up by 16 percent to R4.8 billion while underlying operating profit more than doubled to R240 million.
Sales of plastic packaging products benefited from increased demand in most sectors, but the benefit of increased sales was partially offset by significant increases in polymer prices.
Mpact said net debt at the end of June was expected to be about R1.5bn, 21 percent lower compared to R1.9bn reported last year.
“Lower average net debt and lower interest rates resulted in net finance costs reducing by 28 percent compared to the same period last year to approximately R68m,” the group said.
Mpact expects to release its half-year results on August 5.
sandile.mchunu@inl.co.za
BUSINESS REPORT