Off-market buy-back

On 28 June 2021, Metcash announced that it is undertaking an Off-Market Buy-Back of up to approximately $175m. This follows the Board’s assessment of Metcash’s ability to distribute excess capital to shareholders having regard to: an improvement in the level of economic certainty; its near-term capital expenditure and working capital requirements; opportunities to grow and create shareholder value; while also maintaining a strong balance sheet with low gearing. When combined with $179m of ordinary dividends in respect of FY21, Metcash will have returned over $354m8 to shareholders since payment of the FY20 final dividend.

The Board considered various alternatives for returning excess capital and determined that the Off-Market Buy-Back is the most tax effective and value enhancing strategy for distributing the excess capital. All shareholders who continue to hold shares following the Buy-Back, irrespective of whether they participate or not in the Buy-Back will benefit through earnings per share and return on equity accretive outcomes.

The last day shares can be acquired on-market to be eligible to participate in the Buy-Back and to qualify for franking credit entitlements in respect of the Buy-Back consideration is 30 June 2021. A summary of the Buy-Back details 5 including the proposed timetable is provided in the FY21 Full Year Results presentation. Full details of the Buy-Back will be set out in the Buy-Back booklet that will be sent to eligible Metcash shareholders by 7 July 2021. The Buy-Back is expected to be completed by 23 August 2021.