ATM - A2 Milk Corporation Limited

[sb9]

FYI, new USA a2milk advert/promo

http://a2milk.com/try_a2_milk

[Snoopy]

Freedom Foods and the Perich family have formally cemented a new alliance with China’s New Hope Dairy Group as they continue negotiations regarding a potential purchase of a2 Milk. Under the terms of the alliance, the billionaire Perich family’s Leppington Pastoral Company will partner with New Hope, Freedom and Moxey Farms, one of Australia’s largest single-site dairy operations, in a consortium called Australian Fresh Milk Holdings.
Freedom revealed yesterday that upon completion, it would hold a strategic 10 per cent equity position in AFMH, with the balance held by Leppington Pastoral, Moxey and New Hope.
Freedom’s equity contribution will be about $7 million and AFMH will maintain a relatively conservative gearing structure. It is expected to inject around $80m into Moxey and other greenfield dairy sites.
Both Freedom Foods and New Hope Dairy will have priority access to any increases in milk production at Moxey Farm or greenfield sites acquired by the venture.
Moxey is a major supplier of milk to a2, the board of which met on Thursday night in London, but there was nothing to report on negotiations with Freedom and its bid partner, the US listed Dean Foods.

This 'takeover' by the multi headed hydra: Leppington Pastoral Company (Perich Controlled) New Hope, Freedom (Perich substantial shareholder) and Moxy Farms looks like a lot of people airing their dissatisfaction, rather than a serious bid.

Of those four, I would say it is China's "New Hope" that has by far the largest financial muscle behind them. Yet when "New Hope" were roped into the Agria takeover of PGW, they famously arranged a kind of preference share arrangement where they would share in dividends from PGW in the future. IOW they were taking money out of the consortium, not putting money in. The question is do New Hope have the willingness to put money into ATM, or do they just want to own some Australian farmland? Given past behaviour, and the fact that the Chinese government are more concerned about propping up their own stock market bubble at the moment, I would say no new capital will be available from New Hope in teh immediate future. ATM reinvesting all profits means no possibility of cashflow for shareholders of ATM (present or future) for the forseeable future either.

Freedom ending up with 10% of the proposed "Australian Fresh Milk Holdings", will be a smaller proportion than the 20% they control of the independent ATM now. So no new money from that source. And priority for AFMH will be to put more money into existing and new dairy sites, not promote A2.

Deans in the USA not in a position to inject any meaningful capital either.

Some still hold out hope. But what I see is the multi headed hydra killing its own 'bid' (which doesn't yet exist anyway) stone dead to anyone who dares looks at the situation critically.

SNOOPY

[sb9]

http://www.smh.com.au/business/jdcom...09-gi8e62.html

[NT001]

FYI, new USA a2milk advert/promo

http://a2milk.com/try_a2_milk

Thanks sb9, the a2 promotional video made for use in America is a cracker. Should work a treat on US TV, and also via the web. It's good to see a2MC is getting on with its real job while everyone else speculates about the takeover. My guess is that they'll make similar videos for the UK and Chinese markets. A good idea is worth repeating.

[Leftfield]

FYI, new USA a2milk advert/promo

http://a2milk.com/try_a2_milk

Thanks - helpful informative post.

[Joshuatree]

Good one sb9. Do we have another player?

"[/QUOTE]Sources told Fairfax Media last week that JD.com was also partnering with an international dairy company to buy a strategic stake in takeover target a2 Milk.
A JD.com spokesman declined to comment on the speculation.
However, ​Mr Liu said last week that the company was interested in investing in any company that could "ensure high-quality products for our consumers".

[QFD Sage]

Great advert! Does anyone know if there is any new research in the pipeline? It would be timely to have some good news on the scientific front. Also, I'm keen to understand the Australian supply arrangements better - does anyone know how secure the supply is?

[Harrie]

Most of the a2mc milk is sourced from leppington and Moxey farms. No one knows what the duration of a contractual supply from these farms is but it would need to be pretty tight.
It is an issue I had raised (post 4457)and was also raised interestingly enough a few days later in a blog written by Prof Woodfield in his latest blog. Those who control the supply hold the power. If FF wanted the a2 market to themselves then they could market "a1 free milk" and cut a2 out of the picture, however this is probably unlikely considering that they are trying to stitch a deal up with Deans. Unlikely that Deans would enter into any arrangement where a supply of a2 milk was not guaranteed in some form. This would also cost FF big time in terms of their effective 19% share of a2mc unless they are busy offloading on the open market under speculation that something positive for a2mc is happening. Probably illegal anyway.
The rumoured disagreement between the Perich Boys and Babidge is a bit of a concern, but that has never been verified.

[Joshuatree]

http://www.jd.com/ Type in A2

[NT001]

http://www.jd.com/ Type in A2

Thanks JT. Can you just give me a quick translation of all that, please? It looks to me like the same products are selling for all sorts of different prices. Am I right?