Corporate events

Arnoldo Mondadori Editore S.p.A. has today announced that, in the period between 11 and 15 July 2011, the company bought a total of 541,000 shares (corresponding to 0.2085% of the company’s share capital) on the automated share market at an average price of €2.28219 per share, for a total of €1,234,666.71, in the context of the authorisation of the company’s AGM, held on 21st April 2011 (previously communicated as per Art. 144 bis of Consob regulation 11971/1999), to effect share buy back operations.

The details of the operations, as conducted daily, are indicated below:

date N° of shares bought Weighted average price 11/07/2011 110,000 2.22902 12/07/2011 106,000 2.24066 13/07/2011 80,000 2.32952 14/07/2011 120,000 2.30891 15/07/2011 125,000 2.30827

Following these operations and taking account of the shares already in the portfolio, Arnoldo Mondadori Editore S.p.A. now directly holds 18,391,101 of the company’s shares (or 7.0890% of the share capital). A further 4,517,486 shares are hold by the subsidiary Mondadori Internarional S.A.
Consequently, as of today the total number of shares held now amounts to 22,908,587 (or 8.8304% of the share capital).

***

It should be noted that the Shareholders on 21st April 2011 authorised the buy back of a further 16,546,887 company shares, with respect to a total of 22,367,587 shares, already held, either directly or indirectly on the date of the authorisation issued by the AGM, permitting the attainment of the 15% limit on the existing share capital established by the Shareholders.
The authorisation is valid until the meeting for the approval of the Annual Report for the year to 31 December 2011.

In line with the Shareholders’ authorisation, buy backs are 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.

It should also be noted that, in terms of price and daily volumes, acquisition operations are conducted in line with the norms foreseen by the EU regulation 2273/2003, and that, in terms of daily volumes, the company will not purchase a quantity greater than 25% of the average daily volume of Mondadori shares traded on the regulated market and calculated on the basis of the average daily volume of trading of Mondadori shares in the 20 trading days prior to the dates of purchase.

As part of efforts to optimise its italian magazine portfolio, the Mondadori Group has reached two agreements regarding the future of its current joint ventures with Rodale Inc. and the Hearst Group.

As regards the joint venture Mondadori-Rodale, established in 2000 for the publication of Starbene and Men’s Health, Mondadori will buy the 50% of the share capital held by the American publisher Rodale Inc.
This will allow Mondadori to manage autonomously the monthly magazine Starbene, the leading women’s title in the health/wellbeing sector, while at the same time continuing the publication of the Italian edition of Men’s Health, thanks to a multi-year licensing contract.

Concerning the Hearst-Mondadori Editoriale partnership, Mondadori has reached an agreement with HMI International LLC for the acquisition, by the latter, of the 50% stake currently held by Mondadori.
This joint venture, set up by the partners in 1999, resulted a year later in the publication of the Italian edition of Cosmopolitan under licence from the Hearst Group.

“Both of these operations are part of efforts to optimise our portfolio,” declared Stefano De Alessandri, general manager of Magazines Italy, “and are in line with the aim of redefining, reinforcing and expanding Mondadori’s presence in women’s magazines.”

Antonio Porro will be the Mondadori Group’s new General Manager Educational from June.
Porro will also be proposed to the respective boards of Mondadori Education and Mondadori Electa for the position of managing director.

Porro, who is from Milan, is 46 and has a degree in economics and business administration. Since January 2009 he has been in charge of Mergers & Acquisitions for the Mondadori Group, reporting directly to the deputy chairman and chief executive, Maurizio Costa.

Porro worked previously at Telecom Italia for a period of more than ten years; since 1995 with responsibilities in the Business Division, where he worked, among other things, on strategic marketing, and, from 2001 at the International Division, where he held a number of positions and focused on support and operations for subsidiaries.
He first worked at Mondadori in the early 1990 when he was responsible for development projects.

The Mondadori Group would like to thank Antonio Baravalle for his precious contribution and the seriousness and competence shown, and wishes him the very best in all his future professional endeavours.

The Annual General Meeting of the Shareholders of Arnoldo Mondadori Editore S.p.A., which met today under the Chairmanship of Marina Berlusconi, approved the company’s Annual Report for the year ended 31 December 2010 and deliberated, in line with a proposal resolved by the board of directors on 21 March and previously communicated to the market, to distribute a dividend, net of taxation, of €0.17 for each ordinary share (net of treasury stock) in circulation of the date appointed for coupon detachment.
Dividends will be payable from 26 May 2011 (coupon detachment from 23 May 2011).

In his report to the shareholders, the deputy chairman and chief executive Maurizio Costa outlined the highlights of the group’s performance during 2010, already announced on 21 March.

RENEWAL OF AUTHORISATION FOR THE BUY-BACK AND UTILISATION OF COMPANY SHARES
Following the expiry of the term fixed for the authorisation issued at the Annual General Meeting of 27 April 2010, the shareholders renewed authorisation to effect share buy-backs, up to the 15% of the share capital, the equivalent of 38,914,474 ordinary shares.
By taking account of the shares previously in the portfolio, the total number of shares comprising treasury stock is now 22,367,587 (8,62% of the share capital), of which. 17,850,101 are held directly in the Arnoldo Mondadori Editore S.p.A. portfolio and 4,517,486 are held by the subsidiary Mondadori International S.A., the authorisation allows for the purchase of an additional maximum of 16,546,887 shares.
It should be noted that, with regard to the authorisation of 27 April 2010, the company made no buy backs, given that the market conditions were not in line with the authorisation itself.
The shareholders also authorised, as per Art. 2357 of the Civil Code, the use of shares involved in such buy back operations or already in the company’s portfolio.

In line with the provisions of art. 144 bis of Consob regulation 11971/1999, what follows is an outline of the buy-back programme authorised by the Shareholders:

• Underlying motivation

The renewal of authorisation for the buy-back and utilisation of company shares is aimed at maintaining the legal conditions for eventual further buy-back plans and, as a result, the possibility of taking advantage of investment opportunities or other treasury stock operations, giving to the board of directors the specific faculties 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, including 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.

• Duration

Until the approval of the 2011 Annual Report.

• Cap on the number of shares that may be bought

In line with the expiring authorisation, the renewal concerns the possible acquisition of an additional 16,546,887 ordinary shares which, taking account of the shares already either directly or indirectly held in the portfolio, as outlined above, allows for the purchase of up to 15% of the share capital.
Following the cancellation of 12,971,492 shares, and the consequent reduction of the capital, as resolved by the Shareholders in extraordinary session, the authorisation will permit the buy-back of up to a total of 10.52% 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.
The corresponding minimum and maximum price of sale will therefore 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, in particular:
– the company will not buy shares at a price greater that the highest price of the last independent operation and the price of the highest current independent offer on the regulated market where the acquisition is made.
– in terms of daily volumes, the company will not purchase a quantity greater than 25% of the average daily volume of Mondadori shares traded on the regulated market and calculated on the basis of the average daily volume of trading of Mondadori shares in the 20 trading days prior to the dates of purchase.
Any operations that are effected will be communicated to the market as per the terms of art. 87bis, of Consob regulation 11971/1999.

CANCELLATION OF PART OF THE TREASURY STOCK HELD AND CORRESPONDING TO 5% OF THE SHARE CAPITAL
As indicated above, Arnoldo Mondadori Editore S.p.A. directly holds 17,850,101 company shares, equivalent to 6.88% of the share capital and acquired at an average price of around €6.1697 per share.

The Shareholders, meeting in extraordinary session, approved a proposal for the cancellation of 12,971,492 shares, with a nominal value of €0.26 per share, and corresponding to 5% of the share capital, while keeping in the portfolio, also to service stock option plans, 4,878,609 shares, in addition to the 4,517,486 held by Mondadori International.

The proposal to cancel a part of the shares held as treasury stock is explained by the fact that, in recent years, there have not been opportunities to use such stock as foreseen by the authorisations made by the shareholders, such as share swaps or conversions in financial instruments.

Following the cancellation, and the consequent reduction in the number of shares making up the share capital, would – while maintaining the necessary solidity to support future growth objectives – result in the optimisation of the company’s capital structure and have a positive impact in terms of increasing both earnings per share and dividend per share.

In terms of the impact on the company’s accounts, the “treasury stock”, in compliance with international accounting principles booked as a reduction in net assets, would be reduced by around €80,030,000, against a reduction in the share capital of a nominal €3,372,587.92 – corresponding to 12,971,492 shares with a cancelled nominal value of €0.26 – and a reduction of the “share premium reserve” of around €76,658,000.
The reduction in the share capital approved by the Shareholders will become effective, subject to no objections being submitted, only after a period of ninety days from the registration of the resolution, as foreseen by article 2445 of the Italian Civil Code.

As part of the development strategy of the Group’s Digital area, Arnoldo Mondadori Editore S.p.A. today announced that it has reached an agreement with Fun Gaming S.r.l. (owned by the entrepreneur Marco Bassetti) to establish a new company, 70% of which will be held by Mondadori and 30% by Fun Gaming.

The business of the NewCo – which will have an initial capitalization of €1.2 million – is the provision of an online games offer consistent with the targets and communities of the Mondadori Group’s editorial portfolio.

The start up of these new activities is subordinate to the granting of a public gaming licence by Amministrazione Autonoma dei Monopoli di Stato (the relevant Italian authorities) in compliance with the public bid announced in the Official Journal of the European Union of 10 March 2011 S 48-079188.

Arnoldo Mondadori Editore SpA and Gruner+Jahr AG, partners of the 50-50 joint venture Gruner+Jahr/Mondadori SpA, have appointed Fabienne Schwalbe as the new chief executive and general manager of Gruner+Jahr/Mondadori SpA on a three-year contract.

Schwalbe will take the place of Giacomo Moletto from 2 May 2011, after the relevant corporate boards have discussed and approved the proposal.

Fabienne Schwalbe, 46, is French and graduated in 1985 from the Paris business school HEC. After working in the United States for seven years in advertising, entertainment and publishing, she joined Prisma Presse (Bertelsmann Group) in 1993 for the launch of the magazine Gala, going on to become the advertising director of the weekly Femme Actuelle in 1996.
Schwalbe subsequently gained a number of years experience in the internet sector, working for leading companies operating in Paris and London. In 2002 she returned to Prisma Presse, where she remained for seven years, in a series of positions, including, for the last four years, marketing and circulation director and member of the Group’s executive committee, adding the position of director of corporate communications in 2008. In January 2010 Fabienne Schwalbe created a consultancy firm that operates in France and in Italy in the media, internet and services sectors.

The Gruner+Jahr/Mondadori joint venture, created in 1990, publishes Focus, Italy’s top selling monthly, and its brand extensions Focus Storia, Focus Extra, Focus Junior, Focus D&R, Focus Brain Trainer, Focus Pico and Focus Geronimo Stilton. The company’s portfolio is completed by the monthlies Jack and Geo and the web portals for families Nostrofiglio.it and Mammenellarete.it.

Arnoldo Mondadori Editore S.p.A. today announced that the Annual Report for the year ended 31 December 2010, including the consolidated financial statements, directors’ report, declarations pursuant to art. 154 bis, para. 5 del Dof legislative decree of 24 February 1998 n. 58, along with the Independent Auditors’ Report, the Statutory Auditors’ Report and the Report on Corporate Governance Report and Ownership Structure, is available from today from the company’s registered office, Borsa Italiana S.p.A. and the company’s website www.gruppomondadori.it (Governance Section).

Arnoldo Mondadori Editore S.p.A. has announced that illustrative reports by the directors pertaining to the items on the agenda for the company’s forthcoming ordinary and extraordinary Shareholders’ Meeting on 21 April 2011 (22 April on an eventual second calling) are now available at the company’s corporate offices, Borsa Italiana S.p.A. and on the Mondadori web site www.gruppomondadori.it (in the Governance section).

Notice of the ordinary and extraordinary Shareholders’ Meeting and the agenda are available on the Mondadori web site www.gruppomondadori.it (in the Governance section).

The annual Report for 2010, approved by today’s meeting of the board of directors, will be presented to the financial community by the deputy chairman and chief executive of the Mondadori Group, Maurizio Costa, and the CFO, Carlo Maria Vismara.

During the presentation, to be held at 3 pm at the company’s headquarters in Segrate, management will also provide information about current actions and mid-term plans relating to the businesses in which the Group operates.

The documentation for the presentation is also available to download from the Italian stock exchange web site and the company’s web site www.gruppomondadori.it (Investor Relations section).

The board of directors of Mondadori Electa S.p.A. today appointed Antonio Baravalle, an existing member of the board of the publishing house, as its new managing director.

This followed the acceptance by the board of the resignation of Martin Angioni from his position as managing director and board member in order to take up a new job.

Antonio Baravalle is also the managing director of Mondadori Education and Giulio Einaudi editore.

Mondadori Electa would like to thank Martin Angioni for his efforts and professionalism over the years at Mondadori.