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MND/MNP - Mondi Limited/Mondi plc - First Corporate Forestry Land Deal Signed

Release Date: 16/10/2008 08:00
Code(s): MND MNP
Wrap Text

MND/MNP - Mondi Limited/Mondi plc - First Corporate Forestry Land Deal Signed Mondi Limited (Incorporated in the Republic of South Africa) (Registration number: 1967/013038/06) JSE share code: MND ISIN: ZAE000097051 Mondi plc (Incorporated in England and Wales) (Registration number: 6209386) JSE share code: MNP ISIN: GB00B1CRLC47 LSE share code: MNDI As part of the dual listed company structure, Mondi Limited and Mondi plc (together `Mondi Group`) notify both the JSE Limited and the London Stock Exchange of matters required to be disclosed under the JSE Listings Requirements and/or the Disclosure and Transparency and Listing Rules of the United Kingdom Listing Authority. 16 October 2008 FIRST CORPORATE FORESTRY LAND DEAL SIGNED Mondi, the Regional Land Claims Commission (RLCC) and the Kranskop communities of AmaHlongwa and AmaBomvu have signed a land restitution settlement relating to Mondi forestry land. The agreement provides for the transfer of over 4000 hectares of Mondi land to the two communities. The communities will get title to the land, which will be leased back to Mondi. Mondi has entered into a 20 year lease agreement with the communities to enable the continued supply of timber to Mondi`s mills. This is South Africa`s first forestry related land restitution settlement agreement involving a corporate land owner. This agreement sets an industry precedent by: - creating a sustainable working model of Community Trusts; - ensuring the communities receive an ongoing annual income; - introducing the communities into Mondi`s supply chain by transforming them into approved suppliers; - ensuring a transfer of skills and the increased involvement of community members in the forestry business. The South African Government welcomes the settlement, which establishes an industry template that can be used by other companies as a framework for settling future forestry land claims. "This is very good news for South Africa and for all parties involved in these settlements. Mondi is convinced that the land restitution process is necessary and we will continue to engage with government and communities to find sustainable solutions", David Hathorn, Group CEO of Mondi. "We are very pleased that a settlement has been reached with the community on terms which ensure real empowerment of new farmers and a continued fibre supply for our business," said Viv McMenamin, Mondi South Africa`s Forestry and Transformation Director. "This model and approach set the standard for equitable land restitution agreements that are commercially sustainable and beneficial for all parties." Notes to the editor About the agreements: 1. The key elements of the agreements signed today are: - A sale agreement stating that the land, and some immovable properties on it, will be bought from Mondi by the RLCC for the communities at a value of approximately R20,5m. - Two similar lease agreements were signed between Mondi and the two Community Trusts. - A settlement agreement was signed by all three parties which spell out the terms and governance of the relationship. - The land will be owned by the two communities through the Siyathokoza and Eyethu Trusts. - The land will be leased back to Mondi and will continue to produce timber for use by Mondi`s mills. - The lease agreement, structured over a 20 year period, provides for community income from annual rental and a stumpage fee based on production output, whilst providing a continued timber supply for use in Mondi`s mills. The agreement will also ensure progressive involvement of communities in the forestry business over the same period. - Mondi will provide annual bursary opportunities via its existing bursary scheme for two community members per claim to study forestry at tertiary institutions. - With Mondi`s assistance, the Community Trusts have set up community owned businesses, currently engaged as contractors in the forestry operations. Some 50 people are employed to develop opportunities in the forestry value chain. Development, mentoring and coaching support is included for these businesses as part of the agreement. - Mondi has made an ongoing financial commitment to training, coaching, mentoring and start-up costs for the Community companies, including vehicles and equipment. - FIETA (Forestry Industry Education and Training Authority) has also partly funded training of Trustees, company directors and employees. About Mondi: Mondi is an international paper and packaging group and in 2007 had revenues of Euro6.3 billion. Its key operations and interests are in Western Europe, emerging Europe, Russia and South Africa. The Group is principally involved in the manufacture of packaging paper and converted packaging products; uncoated fine paper and specifically products and processes, including coating, release liner and consumable flexibles. Mondi is fully integrated across the paper and package process, from the growing of wood and manufacturer of pulp and paper (including recycled material) to the converting of packaging papers into corrugated packaging and industrial bags. Mondi has production operations across 35 countries and had an average of 35 000 employees in 2007. Contact: Kerry Crandon Group Communications Manager Mondi Tel: +27 11 994 5425 E-mail: kerry.crandon@mondigroup.com www.mondigroup.com Louise Brugman PR Representative for Mondi Financial Dynamics Tel: +27 11 214 2415 Email: louise.brugman@fd.com www.fd.com Sponsor UBS South Africa (Pty) Ltd Date: 16/10/2008 08:00:03 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.

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