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

 

A2 shares soar 25%, making it NZ's biggest listed company

A2 shares soar 25%, making it NZ's biggest listed company

By Paul McBeth

Feb. 21 (BusinessDesk) - A2 Milk Co shares jumped 25 percent, making the milk marketing firm New Zealand's biggest listed company on a deal that will give it backing from Fonterra Cooperative Group.

The stock gained $2.31 to $11.60, valuing a2 Milk at $8.47 billion, toppling Auckland International Airport at $7.75 billion, Fisher & Paykel Healthcare at $7.37 billion and Meridian Energy at $7.29 billion. The spike underpinned the S&P/NZX 50 index, which gained 1.5 percent to 8,215.63 as at 2.35pm.

A2 unveiled a strategic partnership with the world’s biggest dairy exporter agreeing to exclusively supply a2 with A1 protein-free milk products in bulk powder and consumer packaged forms, in exchange for an exclusive licensing agreement to produce, sell and market a2 branded fresh milk for end sale in the New Zealand market. They'll set up an A1 protein free milk pool in Australia and Fonterra also gets exclusive supply rights for some products in new markets for a2 in South East Asia and the Middle East up to a specified volume.

"It was a pretty significant announcement for a2 and shows their growth can move by a lot quicker than past opportunities with Synlait Milk," said Grant Williamson, a director at Hamilton Hindin Greene in Christchurch. "The Australian investors in particular just like this company."

Synlait shares sank 11 percent to $6.31, having followed a2 higher through 2017 on expectations the close supply arrangement would see the milk processor benefit from the growing demand for the marketing firm's branded products.

"Investors in Synlait obviously through with the connection between the two, Synlait would have to keep up," Williamson said. "This changes things."

Units in the Fonterra Shareholders Fund gained 0.8 percent to $6.05.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Real Estate: Foreign Buyers Ban Passes Third Reading

The Bill to put in place the Government’s policy of banning overseas buyers of existing homes has passed its third and final reading in the House. More>>

ALSO:

Nine Merger: Fairfax Slashes Value Of NZ Business

Fairfax Media Group more than halved the value of its Kiwi assets, attaching just A$40 million to mastheads that were once the core of a billion dollar investment. More>>

Collecting Scalpers: Commerce Commission To Sue Viagogo

The Commission will claim that Viagogo made false or misleading representations: • that it was an “official” seller, when it was not • that tickets were limited or about to sell out • that consumers were “guaranteed” to receive valid tickets for their event • about the price of tickets... More>>

ALSO:

Price Of Cheese: Fonterra CEO Goes Early After Milk Price Trimmed

Aug. 15 (BusinessDesk) - Fonterra Cooperative Group chief executive Theo Spierings is leaving the role early after the world's biggest dairy exporter lowered its farmgate payout and trimmed its dividend to retain cash. More>>

ALSO: