Corporate events

Arnoldo Mondadori Editore S.p.A. today announced that its annual Corporate Governance Report is available for public inspection at the company’s headquarters and at the Borsa Italiana S.p.A. The document is also in the “Corporate Governance” section of the web site www.gruppomondadori.it.

The Board of Directors of Arnoldo Mondadori Editore S.p.A. will ask the forthcoming Annual General Meeting of the Shareholders to renew – until the approval of the Annual Report for 2009 – authorisation to effect share buy-backs up to the legal limit of 10% of the share capital, authorisation already granted by the AGM of 22 April 2008 and due to expire with the approval of the Annual Report for the year to 31 December 2008.

The Annual General Meeting of the Shareholders, scheduled for 29 April 2009 (or 30 April on second calling) will also be asked to authorise the use of shares involved in such buy back operations or already in the company’s portfolio, as per Art. 2357 of the Civil Code.

The highlights of the board of directors’ proposal are as follows.

• Underlying motivation

The underlying reason for the request for authorisation to effect buy backs and make use of Company shares is that it will allow the Board of Directors to:

– use company shares for the exercise of options for the purchase of shares assigned to participants in the stock option plans put in place by the Shareholders;

– use company shares, either bought or in the portfolio, for the exercise of rights, also conversion rights, deriving from financial instruments issued by the company, its subsidiaries or third parties;

– use company shares, either bought or in the portfolio, as part or whole payment in any eventual acquisitions or equity investments that fall within the company’s stated investment policy;

– take advantage, where and when considered strategic for the company, of investment opportunities, also in relation to available liquidity.

• Cap on the number of shares that may be bought

The authorisation request relates to the legal limit of 10% of the company’s share capital, or 25,942,983 shares.

Given that the company currently holds 15,580,101 of its own shares and that a further 4,517,486 Mondadori shares are held by the subsidiary Mondadori International SA – making an overall total of 20.097.587 shares, corresponding to 7.747% of the share capital – the new authorisation would give the Board the faculty to buy back a further 5,845,396 ordinary shares, corresponding to 2.253% of the share capital.

• Method of acquisition and the price range

Buy backs would be effected on regulated markets as per art. 132 of the legislative decree of 24 February 1998 n. 58 and art. 144 bis, para. 1, B of Consob regulation 11971/99 according to operating procedures established by the regulations for the organisation and management of the markets themselves, which, does not permit the direct combination of offers to buy with predetermined offers to sell.

Consequently, the corresponding minimum and maximum price of sale will be determined at the same conditions that applied to previous authorisations agreed by the Shareholders, i.e. at a unit price not less than the official market price on the day prior to any operation, less 20%, and not more than the official market price on the day prior to any operation, plus 10%.

In terms of price and daily volumes, acquisition operations will in any case be conducted in line with the norms foreseen by the EU regulation 2273/2003.

Arnoldo Mondadori Editore S.p.A. today announced, as per Art. 2.6.2 of the regulations governing markets organised and managed by Borsa Italiana S.p.A., its calendar of corporate events for 2009:

• Wednesday 25 March 2009: meeting of the Board of Directors for the approval of the Annual Report for the year ended 31 December 2008;
• Thursday 14 May 2009: meeting of the Board of Directors for the approval of the 1st Quarter Report to 31 March 2009;
• Wednesday 29 July 2009: meeting of the Board of Directors for the approval of the Interim Report to 30 June 2009;
• Thursday 12 November 2009: meeting of the Board of Directors for the approval of the 3rd Quarter Report to 30 September 2009.

The Annual General Meeting of the Shareholders for the approval of the Annual Report for the year ended 31 December 2008 will be held on Wednesday 29 April 2009, on first calling, or Thursday 30 April 2009, on second calling.

Analysts’ presentations of the results for the full year to 31 December 2008, the interim report to 30 June 2009 and the reports on the first and third quarters of 2009 will be held on the dates, as indicated above, of the respective meetings of the Board of Directors.

Any eventual changes to the above calendar will be promptly communicated to the market.

With regard to press reports concerning the supposed sale of the business activities of the educational sector, Arnoldo Mondadori Editore S.p.A. would like to make it clear that no such plan exists, nor are any negotiations underway.

Arnoldo Mondadori Editore today announced that – following the formalisation of mandatory communication to the Italian Competition Authority – the definitive contract has been signed for the sale of 80% of the share capital of the subsidiary Mondadori Printing S.p.A. to Gruppo Pozzoni, as per the preliinary agreement reached on 14 October and previously communicated to the market.

Arnoldo Mondadori Editore today announced that it has signed a preliminary contract for the sale of 80% of the share capital of its subsidiary Mondadori Printing S.p.A. to Pozzoni Group.

The transaction price was defined on the basis of an enterprise value for 100% Mondadori Printing of €145 million. The impact of the operation on the Mondadori Group’s consolidated net financial position will be in the region of €123 million.

The operation should be seen in the context of the general trend that increasingly characterises the printing sector at an international level: in which there is a growing tendency towards consolidation and aggregation among the most qualified operators in a market that is undergoing deep structural changes as a result of new competitive pressures, over-capacity in terms of production and a downturn in demand.

The agreement gives Pozzoni Group an option to acquire a further 20% stake in Mondadori Printing, to be exercised from December 2011 at a cost determined by the fair market value of the company at the time of the exercise of the option. Mondadori will retain an option to sell the same 20% stake from January 2017 at a price to be determined by the above mentioned criteria.

The agreement also includes a eight-year printing contract – renewable on terms in line with the best market benchmarks – guaranteeing Mondadori an improvement in terms of costs and the maintenance of high standards of quality. Additional continuity will be guaranteed by the confirmation of the current managing director of Mondadori Printing.

Mondadori Printing S.p.A. is the Mondadori Group company in which the activities of the Printing Division are concentrated, with four plants in Italy – located in Verona, Cles (TN), Pomezia (RM) and Melzo (MI) – and one in Spain at Toledo.

For the year ended 31 December 2007 the Mondadori Printing Division recorded revenues of €439,9 million and in the first half of 2008 the Division generated total revenues of €196,1 million.

Pozzoni Group is one of the most important players in the printing business and comprises 10 operating companies, nine plants (located in the provinces of Milan, Bergamo, Vicenza, Padua and Naples). In 2007, the company recorded consolidated revenues of €166 million, 20% of which from foreign sales.

With this operation Pozzoni Group completes its development strategy based on acquisitions and places the company among the leading European printers in terms of both revenues and staff.

The terms of the operation and the signing of the preliminary contract are subject to the legal notifications to the Italian Competition Authority.

With regard to press reports concerning the supposed sale of the business activities of the educational sector, Arnoldo Mondadori Editore S.p.A. would like to make it clear that no such plan exists, nor are any negotiations underway.

Arnoldo Mondadori Editore SpA today announced the resignation of Achille Frattini as Member of the Board of Auditors, citing regulatory restrictions on multiple memberships of such boards in listed companies.

Frattini had been re-elected a Full Member of the Board of Auditors for the three-year period 2006 – 2008 by the company’s AGM on 26 April 2006, on the only list to be presented, that of the shareholder Fininvest SpA.

Francesco Antonio Giampaolo, who had already been appointed as Substitute Member on that same list, now replaces Achille Frattini as Full Member of the Board of Auditors.

Francesco Antonio Giampaolo was born at Orta Nova in Foggia province on 15 February 1943. He graduated in Economics and Business from Milan’s Catholic University of the Sacred Heart in 1969, and started work as Accounting Organisation and Procedures Manager in a major Milanese industrial firm. Mr Giampaolo has been a Registered Business Practitioner since 1975; his practice is entirely devoted to the corporate sphere and he has accumulated many years’ experience in legal, business and financial affairs. As technical adviser to the bench at the Court of Milan, he has carried out a number of commissions in addition to providing routine advice and valuations; he was made an Official Auditor in 1983, and for over twenty years has sat on or chaired Boards of Auditors in medium-sized and large companies in industry, commerce, finance and insurance.

Mondadori thanked Achille Frattini for his valuable contribution and professional advice over many years.

Arnoldo Mondadori Editore S.p.A. today announced the completion of the exclusive negotiation agreement – previously communicated to the market on 29 April – formalised today with the sale to Motor Presse France of six specialised titles published by Mondadori France group.

Under the terms of the agreement the activities relative to the publication of Le Cycle; l’Officiel du Cycle de la Moto et du Quad; Bateaux; Golf Européen, Golf Magazine and Guide Bel-air have been transferred, along with some support structures.

The final price of the transaction has been agreed at €8.3 million.

Arnoldo Mondadori Editore S.p.A. has defined an agreement for exclusive negotiations, with the French publisher Sofimav, for the sale of the specialist titles La Pêche et les Poissons and Pêche Mouche (2007 revenues: circa €2 million). In France and in Spain Sofimav is the publisher of magazine titles in the leisure sector (Plongée Magazine, Apnéa, Balades, la pêche de la truite, la pêche des carnassiers, Sanglier Passion, Bécasse Passion, Buceadores).

This is a continuation of the widely announced rationalisation of the Mondadori France portfolio which will increasingly focus on upscale and mass market titles.

Implementation of the negotiation agreement is subject to the completion of the consultation procedure with the works council foreseen by French legislation.