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Strategic Review Announcement

NZAX and media release
18 April 2012

Strategic Review Announcement

MARKET UPDATE

A2 Corporation Limited (NZAX:ATM) (“A2C”, “the Company”) announces today that it is undertaking a strategic review of its options to accelerate growth and maximise shareholder value. This review is being carried out in light of the Company’s strong growth options as well as approaches received from parties potentially interested in partnering with A2C.

a2™ brand milk has been successfully established as a premium priced fresh milk product, positioned on a broad health platform focusing on digestive wellbeing. It is the fastest growing milk brand in the Australian market and the major driver of category growth nationally, accounting for approximately 5.0% of grocery channel market share by value.

The Company recently took important steps towards the marketing of its products in the significant UK and Ireland fresh milk markets by forming a partnership with Robert Wiseman Dairies, Britain’s largest fresh milk company. Preparation for the launch, scheduled for September 2012, is well under way.

A2C is separately advancing plans to launch an a2™ infant formula product into the Chinese market, in conjunction with a strong local marketing partner. In that context, A2C has recently entered into an agreement with Synlait for the manufacture and supply of a2™ nutritional powders, including infant formula, for sale by A2C in international markets, including China.

In March, the Company successfully raised NZ$5.2m in capital at an issue price of NZ37 cents per share to provide additional flexibility for growth.

A2C Chairman, Cliff Cook said: “The Company has achieved outstanding success recently and is gaining significant momentum from the successful commercialisation of its brands in Australia and increasing awareness of A2 milk in other markets.

“As a result, the Company has numerous growth avenues available to it, both in terms of geographic and product expansion.

“We are conscious of ensuring that we lay the appropriate platform for growth in new markets and the next strategic steps we take are important to ensure we optimise shareholder value. This, coupled with recent approaches from industry participants, make this the appropriate time to undertake a full review of our strategic options to seek to accelerate growth and shareholder value creation.”

A2C CEO, Geoffrey Babidge said: “The strategic review will have regard to the fact that A2 is already well positioned to maximise long term growth standalone as well as considering partnership options to support expansion, in specific jurisdictions or more broadly.”

The Board has retained Greenhill Caliburn as principal advisor for the strategic review with support from Clavell Capital.

The Company will continue with its business as usual during the review process and does not intend to disclose further developments regarding the process until the review is completed. The review may take several months and it is possible that it will result in no changes to the existing business.


ENDS


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