Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


A2 to raise $20M in placement, big shareholders sell down

A2 to raise $20M in placement, big shareholders sell down to allow main board listing

Dec. 5 (BusinessDesk) - A2 Corp, which markets milk products with a protein variant claimed to have health benefits, plans to raise $20 million in a placement while its three major shareholders will sell down their stakes, boosting liquidity to allow a shift to the NZX main board.

The Sydney-based company has been listed on the NZAX market since 2004 and in that time has grown to $411 million – bigger than some existing companies on the NZX 50 Index. But more than half the shares are held by three investors, meaning the company’s ‘free float’ is smaller.

ASX-listed Freedom Foods Group owns about 26 percent, Mountain Road Investments, associated with chairman Cliff Cook has 22.7 percent and Equity Group Investments has 8.3 percent currently. Their holdings will reduce to 18 percent, 8.9 percent and 4.6 percent respectively after the selldown.

The placement to institutions and the selldown are both priced at 50 cents a share, a 26 percent discount to the price they last traded on the NZAX of 68 cents before being halted. They remain in trading halt pending the placement. Inclusions in the NZX 50 could happen as soon as February next year.

Managing director Geoffrey Babidge said the funds will be used to drive its global growth, specifically targeting the UK liquid milk market, the Chinese infant formula market, lifting awareness of the A2 brand in Australia and New Zealand, entering the Chinese liquid milk market with UHT milk and going after another key market such as the US, Canada or Germany.

Freedom Foods, Mountain Road and Equity Group have undertaken not to sell any more of their shares until at least 10 days after the release of A2’s results for the year ending June 30, 2013.

The shares have soared 179 percent this year as sales soared in Australia, it began selling infant formula into China and expanded in the UK. Profit in the year ended Jun 30 more than doubled as revenue jumped 44 percent. The bulk of sales were in Australia.

The plan to raise $20 million follows more modest capital raisings, adding up to $7.7 million last year. As at June 30 it had cash on hand of $6.6 million and little or no net debt.

Last month, in announcing the results of a strategic review, the company confirmed it would continue to be “capital light,” relying on partnerships to drive its growth into new dairy markets and categories.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Strike: Lyttelton Port Workers Vote To Escalate Dispute

Members of the Rail and Maritime Transport Union (RMTU) at Lyttelton Port today voted to escalate their industrial action. Around 200 RMTU members have been operating an overtime ban since 17 December and today they endorsed a series of full withdrawals of labour at the port. More>>

ALSO:

Scoop Business: NZ Dollar Falls To 3-Year Low As Investors Favour Greenback

The New Zealand dollar fell to its lowest in more than three years as investors sold euro and bought US dollars, weakening other currencies against the greenback. More>>

ALSO:

Scoop Business: NZ Govt Operating Deficit Smaller Than Expected

The New Zealand’s government’s operating deficit was smaller than expected in the first five months of the financial year as a clampdown on expenditure managed to offset a shortfall in the tax-take from last month’s forecast. More>>

ALSO:

0.8 Percent Annually:
NZ Inflation Falls Below RBNZ's Target

New Zealand's annual pace of inflation slowed to below the Reserve Bank's target band in the final three months of the year, giving governor Graeme Wheeler more room to keep the benchmark interest rate lower for longer.More>>

ALSO:

NASA, NOAA: Find 2014 Warmest Year In Modern Record

Since 1880, Earth’s average surface temperature has warmed by about 1.4 degrees Fahrenheit (0.8 degrees Celsius), a trend that is largely driven by the increase in carbon dioxide and other human emissions into the planet’s atmosphere. The majority of that warming has occurred in the past three decades. More>>

ALSO:

Scoop Business: New Zealand’s Reserve Bank Named Central Bank Of The Year

The Reserve Bank of New Zealand’s efforts to stifle house price inflation by using new policy tools has seen the institution named Central Bank of the year by Central Banking Publications, a publisher specialising in global central banking practice. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news