ATM - A2 Milk Corporation Limited

[Lola]

A listed company is obligated to inform the market of anything that may materially affect the price of the company's shares. Obviously a cap raising is material. It is providing this information so that current shareholders who may be buying or selling shares today on the basis of the takeover offer news, have all the information they need to appropriately judge whether today is a good or bad time to buy or sell. This information would be clearly relevant to those holding large chunks of ATM stock (Freedom, Perich family) and it will be a factor in whether they choose to back a take over offer or not (and they will be currently being canvassed by the buyers to see what price they would be willing to sell at). If information is provided to these shareholders, it must be disseminated to all shareholders.

Do you really believe that??
Obligations and the real world are still poles apart.

[nextbigthing]

I would've thought if ATM is going to be taken over, it would be at a price much higher than the current 66cps.

Amazing opportunity perhaps?

[drcjp]

I for one do not consider it coincidence that this has come on the heels of a dropping NZ dollar, an apparently successful minor scale intro into USA, a developing market in England and who knows how many yum yum, big bucky cans sold in PDRC. We are now in last week of Q4. Careful notice also suggests the big market players are now steadying for another rise over the rest of this week.

Hold on grandma and don't crack the good stuff just yet Dennis.....

[Harrie]

Would of thought that contemplating and planning a CR at this early stage of progress in the USA is a good thing given a2mc natural tendency to risk aversion. The way I read it, expansion and the funding of that expansion would only be contemplated on positive results.

I think that Perich is in there somewhere. He seems to be an advocate for a2 fresh milk and other a2 product.
Given that via FF and Arrovest his interests are close to 20% of ATM, wouldn't be surprised if this expression of interest is coming from Arrovest.
Past 20% they are forced to make an offer to all shareholders.

Built into the 0.66c SP is the threat that the offer may not go ahead. If there is an offer subject to DD etc then its likely to go above 0.76c on further speculation and the offer is likely to be around 0.85 to $1.10.
Could be a cash and FF share offer with FF listing on the NZX?

Can't see why the CR planning issue needed to be raised either?

[bull....]

just on cnbc say freedom don't know who it is and management are leaving the country to see clients?

[bull....]

corrected it is freedom foods

[see weed]

Tried to buy more at 66c at 4.57pm. but missed out. In my exp. (in the surf) hopefully the second wave tomorrow may be bigger, with all the media attention etc.

[NT001]

Normally I wouldn't be too surprised if the Perich family were involved, but doubt that FF are keen on spending big bucks on a takeover. Perich seems quite positive about A2 milk, but FF has never indicated much public enthusiasm, and recently announced its 19% a2MC stake is available for sale. FF is is not primarily a dairying outfit, and is investing heavily in new plant to increase its production of snack and health foods, its main area of interest.

But I wouldn't necessarily assume the mystery people behind the takeover interest are FF and Perich. Some reports out of Australia today assert they are not involved. There would be others watching carefully, and impressed with a2MC's progress and strategy. Could be Chinese or American. In fact I wouldn't be startled if it turned out a2MC's new US chief executive, Jeffrey O'Neill, was involved. No evidence whatever for this, but if he can see a big future for A2 milk in the US and elsewhere, why wouldn't he want to buy the firm and do things his way? He has big experience, notably in the beverage industry, and would probably have the connections to fund a takeover. The US is the obvious big future market for A2 Milk, lacking the uncertaities of China. I stress this is pure speculation but it would make sense, and when hard information is lacking one has to think laterally.

As a LT holder and a firm believer in the underlying science, my worry would be if the potential bidders were Big Dairy interests hoping to stem rather than advance the A2 proposition. It could be argued that Big Dairy (and that doesn't necessarily mean Fonterra, which has its own probems at the moment) has more to lose from a2MC's continued existence and gradual expansion than what it might cost to buy the company and its IP now and render it ineffectual.

Whether I sell or not will depend largely on who the bidders are. I would like it to remain essentially a NZ company controlling its IP. But above all I would like the A2 proposition to become accepted and carried forward for the benefit of all consumers. I believe in it for other reasons besides purely as an investor.

And I agree with Snaps, some big investors will be reluctant to sell.

[Kirk]

Normally I wouldn't be too surprised if the Perich family were involved, but doubt that FF are keen on spending big bucks on a takeover. Perich seems quite positive about A2 milk, but FF has never indicated much public enthusiasm, and recently announced its 19% a2MC stake is available for sale. FF is is not primarily a dairying outfit, and is investing heavily in new plant to increase its production of snack and health foods, its main area of interest.

But I wouldn't necessarily assume the mystery people behind the takeover interest are FF and Perich. Some reports out of Australia today assert they are not involved. There would be others watching carefully, and impressed with a2MC's progress and strategy. Could be Chinese or American. In fact I wouldn't be startled if it turned out a2MC's new US chief executive, Jeffrey O'Neill, was involved. No evidence whatever for this, but if he can see a big future for A2 milk in the US and elsewhere, why wouldn't he want to buy the firm and do things his way? He has big experience, notably in the beverage industry, and would probably have the connections to fund a takeover. The US is the obvious big future market for A2 Milk, lacking the uncertaities of China. I stress this is pure speculation but it would make sense, and when hard information is lacking one has to think laterally.

As a LT holder and a firm believer in the underlying science, my worry would be if the potential bidders were Big Dairy interests hoping to stem rather than advance the A2 proposition. It could be argued that Big Dairy (and that doesn't necessarily mean Fonterra, which has its own probems at the moment) has more to lose from a2MC's continued existence and gradual expansion than what it might cost to buy the company and its IP now and render it ineffectual.

Whether I sell or not will depend largely on who the bidders are. I would like it to remain essentially a NZ company controlling its IP. But above all I would like the A2 proposition to become accepted and carried forward for the benefit of all consumers. I believe in it for other reasons besides purely as an investor.

And I agree with Snaps, some big investors will be reluctant to sell.


http://hotcopper.com.au/threads/ann-freedom-foods-group-announcement-by-a2-milk-company.2539073/?post_id=15508342#.VYee4vmqpBc

[Kirk]

so freedom foods it is along side a liquid production company...........coke, pepsi....going to get interesting.
Imagine how powerful the commercialisation of A2 would be with a big name brand behind it.

The other one might be New Hope. http://www.theaustralian.com.au/business/news/a2-milk-targeted-by-takeover-bid-from-freedom-foods-new-hope/story-e6frg906-1227409162896

[biker]

so freedom foods it is along side a liquid production company...........coke, pepsi....going to get interesting.
Imagine how powerful the commercialisation of A2 would be with a big name brand behind it.

'........International liquid dairy milk Company......'

Which Companies are the possibilities?

[silverblizzard888]

'........International liquid dairy milk Company......'

Which Companies are the possibilities?

When I type that into google it comes up first with " Mondelēz International" Perhaps with the USA entry it has sparked the US company to go after it

[Joshuatree]

High chance of some leakage from one of the three, forcing an annoucement . Keep Google handy.

[NT001]

OK, so FF has identified itself. Of course, since it already owns 19% it could be the minor party in a JV takeover without spending more money.

But once a takeover is in play, I wouldn't rule out counter-offers.

And New Hope would be in an interesting position. It's big in overall dairying, and as I've said on this thread previously, the real guts of the A2 proposition is not just that A2 is marginally easier to digest than other milk, but that other milk (containing A1) is positively harmful healthwise. a2MC is not yet broadcasting this message very loud, because at this stage it doesn't want an all-out confrontation with Mainstream Dairy. But whoever owns the company in future is going to have to eventually convey this message for clarification, and one has to question how easy that would be for a major mainstream dairy marketer, saying in effect that the majority of the product it sells is medically risky.

I'd be quite concerned that New Hope might stop short of telling public consumers this, and thus suppress the real A2 message.

[drcjp]

FWIW, Muller Wiseman. They took out Cresta in the UK last year. Lets hope that the IP and equity raise are included in the offer. IOW, wise up to Wiseman

[sb9]

Well, by now we all have fair idea who the interested parties (at least 1 for sure). It closed at 61c on ASX, guessing it might open around 70c on NZX tmrw. Let's wait and watch, exciting times ahead!!!

[gv1]

Who's Arrovest...they bought in june.

[NT001]

Arrovest is the dairying business vehicle of the Perich family which owns 60% of Freedom Foods. It has recently expressed publicly its pride in the fact that it supplies a lot of the A2 milk from NSW now going into China. It is therefore in a position to drive Freedom's actions.

Drcjp, I'm not sure what you mean by "wise up to Wiseman", but I would imagine that a2MC has a pretty good handle on Muller Wiseman and is protecting its IP very well in that regard, since Muller Wiseman now procure, process and distribute A2 Milk in the UK under contract for a2MC. Also, Billy Keane, who was MD of Robert Wiseman Dairies prior to the Muller takeover of Wisemans and also chairman of Dairy UK was appointed in late 2013 as a director on a2MC's UK board, and as far as I know still has that seat, and is personally a keen advocate of A2 milk. I would doubt if Muller Wiseman has any ambitions regarding a2MC apart from earning good money under the contract.

[drcjp]

This week is going to be interesting wrt the SP. I recall MAM buying a whole pile at 0.77 (approx. 10M) around about this time last year so I would be looking for them to try and make that back + enough to help with "other matters".

NT001: yep, your quite right but that's not what I meant sorry. I was speculating that it would not surprise me if MW wanted to take over A2M for themselves, based on positive news via England/Aussie/USA/China, the current doldrums in the dairy market for common cow A1 liquid and their experience as you say.

[NeverQuestion]

If the total share purchase of A2M goes ahead what will that mean for ATM?

[blackcap]

If the total share purchase of A2M goes ahead what will that mean for ATM?

A2M = ATM (A2M is the Australian listed code, ATM is the NZ listed code)

[NeverQuestion]

A2M = ATM (A2M is the Australian listed code, ATM is the NZ listed code)


Ahh,

So basically all share holders in ATM and A2M get bought out at a set price?

[longy]

It is early to say but according to the letter... in short... Yes.

[sb9]

From hotcopper.com.au

"a2 shares rose almost 20 per cent to 61c on news of the approach. Freedom shares closed almost 7 per cent higher at $2.99. “a2 has created unique dairy products with perceived health benefits that open up cow’s dairy to a raft of new potential customers,” UBS said. “We value the company at NZ$1.02 (90.4c) per share with upside to NZ$1.62 per share should we factor a full North America rollout and success in the Chinese milk market.” At the top end of the range this could see a2 valued at $950m.

reference http://www.theaustralian.com.au/bus...-bid-for-a2-milk/story-fn91v9q3-1227410131226 (http://www.theaustralian.com.au/business/companies/perich-kicks-off-dairy-wars-as-freedom-foods-leads-bid-for-a2-milk/story-fn91v9q3-1227410131226)
"

By the way the article above is Paid Content, if someone has access pls do summarise.

[winner69]

From hotcopper.com.au

"a2 shares rose almost 20 per cent to 61c on news of the approach. Freedom shares closed almost 7 per cent higher at $2.99. “a2 has created unique dairy products with perceived health benefits that open up cow’s dairy to a raft of new potential customers,” UBS said. “We value the company at NZ$1.02 (90.4c) per share with upside to NZ$1.62 per share should we factor a full North America rollout and success in the Chinese milk market.” At the top end of the range this could see a2 valued at $950m.

reference http://www.theaustralian.com.au/bus...-bid-for-a2-milk/story-fn91v9q3-1227410131226 (http://www.theaustralian.com.au/business/companies/perich-kicks-off-dairy-wars-as-freedom-foods-leads-bid-for-a2-milk/story-fn91v9q3-1227410131226)
"

By the way the article above is Paid Content, if someone has access pls do summarise.

Not that much new stuff. Did go on about dj.com and freedom a bit and the way it was written it assumed new hope was the other party

Those UBS valuations about what MAC was touting so must be right

My guess if offer comes it will be 95 cents to 110.

What what the heck do I know

[gv1]

what some people paid that much last year.

[nextbigthing]

My guess if offer comes it will be 95 cents to 110.



So you buying up big time at these levels then Winner?

[sb9]

Looks like 75c is round the corner...

[iceman]

Looks like 75c is round the corner...

I would be surprised if something significantly higher than 75c isn't around the corner !

[Snoopy]

what some people paid that much last year.


Ah well that's all solved then. No need to worry about doing due diligence if you are planning a takeover. Just pay the highest price paid during last years speculative bubble and all existing shareholders will be happy!

SNOOPY

[Snoopy]

Still not sure how to best model the China growth plan? I am now thinking that China is more like a lucrative branch of Australasia as all the product is imported from NZ/Oz.

So I think the ATM growth model is more like:

(Oz/NZ/China) funds (UK) funds (USA)

Of course 'conquering the UK' seems to be mainly happening in the lower right hand corner of England including London. And conquering the USA might initially translate to conquering just California. So I am picking that UK will have to fund growth over the rest of the UK as well as the USA. Or maybe Australian growth covers the expansion into the rest of the UK? That is the money that Australia generates that isn't needed to develop China! The problem is $20m over three years for the USA is big money for ATM, but not big money for the task they want to do. All the future cashflow looks to be on a knife edge. Keeps me on the sidelines not buying. I wonder when the necessary upcoming cash issue will happen?

When ATM was 70c, the institutions balked at paying more than 50c for new shares. So with ATM arround 55c, I think 40c is looking likely. But wouldn't that leave you as a fund manager looking red faced if you paid 50c for the last cash issue? Perhaps that is why those institutions don't want to do it?

Big cash being generated in Australia? I guess so, but 'big' only in relation to ATM shareholder funds, not the road map that ATM have drawn out ahead of them.


I see that finally the much anticipated (by me only) cash issue has reared its ugly head, exactly as I predicted.

From the 22nd June announcement.
"the Company has recently been contemplating, and was in advanced stages of planning for, an equity raising."

Still ever since the Oz market listing, they have been softening up shareholders for this moment by subtley changing the wording of their press releases even if the most enthusiastic shareholders didn't want to get that message.

By combining that announcement will the second announcement that two parties are interested in taking a stake, ATM management have managed to push up the share price. This is exactly what needs to happen if they want to get another cash issue away at a price acceptable to those who have subscribed before. If they could get the cash issue away at 50c that would be a good result for the company, while those who had previously subscribed at 50c in the last cash issue wouldn't be too offended.

'Enthusiasts' have been going on about who the second party of interest (the first being Freedom foods) might be. The press release says that two associated parties are looking at making one offer. This means the second party is very likely Arrowvest, the dairying business vehicle of the Perich family which owns 60% of Freedom Foods.

The idea that another party like New Hope is involved would only be seriously contemplated by those who didn't bother to read the press release properly.

The potential offer as yet doesn't exist and has been brought into the open before any bid was on the table.

"The parties have requested confidentiality, and stated that their expression of interest is indicative and non-binding and may can be withdrawn if it ceases to be confidential."

Technically you could argue that the offer is now dead, because ATM have breached confidentiality. However, now that Freedom have outed themselves I think we can conclude that the due diligence will proceed even if the offer does not.

The takeover code requires an offer for all shares should one block of associated interests want more than a 20% shareholding. Everyone here is jumping on the idea that Freedom/Arrowvest may want to take over the whole company, but they may not. They may make a lowball offer to ensure that the majority of outstanding shareholders do not accept. That way ATM would remain listed and Freedom/Arrowvest could just buy a 51% controlling stake.

SNOOPY

[Ginger_steps_]

So what do you all think will happen to the SP if the take-over doesn't eventuate, and is replaced with the cash issue? Sharp drop back to 58c?

[Ginger_steps_]

So what do you all think will happen to the SP if the take-over doesn't eventuate, and is replaced with the cash issue? Sharp drop back to 58c?

[Tsuba]

Ask Snoopy. He knows it all.

[Lola]

So what do you all think will happen to the SP if the take-over doesn't eventuate, and is replaced with the cash issue? Sharp drop back to 58c?

What I would think is that it would be a brilliantly disguised effort at price manipulation. But I don't think that is the case at all, and we will see ATM get the cash it needs from an off shore source by way of new shares plus a part take out to shareholders and maybe a scrip offer from Freedom just to keep the minorities in the long term game, which would be great.

In other words a cash plus scrip bid but from two parties acting together. Just my guess. ;)

[Snoopy]

So what do you all think will happen to the SP if the take-over doesn't eventuate, and is replaced with the cash issue? Sharp drop back to 58c?


It all depends how badly ATM needs the cash. Their cash balance IMO was already on track to expire before they announced the court case with the ABC. So ATM really need to do a placement or a more general cash issue to all shareholders in a timeframe measued in weeks or months. If the cash issue is a significant one, then the share price will drop to near the cash issue price (I'm guessing 50c). But if it is a smaller cash issue, then the share price might hold near current levels. It does seem that Freedom at the very least will be taking up their share of any cash issue.

If there is a separate share issue granted to Freedom, then that takes the pressure of the share price with one hand. But then that increases the dilution of existing shareholders share of the business going forwards. That in turn means existing shareholders shares are worth less if the business plan going forwards hasn't changed.

Whatever happens it looks loike managment are doing the right things. 'Pump and place' is probably the best thing for the company as a whole going forwards. It might not be the best thing for existing shareholders though!

SNOOPY

[Snoopy]

If its not New Hope I'll be very surprised - Perich and New Hope have been in bed with each other for a while.


The second party could be New Hope. But if the two parties contemplating an offer are "New Hope/Freedom Foods", then the second party can't be Arrowvest. I am not sure you can dissociate Arrowvest from Freedom Foods, because we know that Arrowvest owns 60% of Freedom Foods.

OTOH New Hope was 100% Chinese government controlled last time I looked. So while Perich and New Hope may have had business dealings in the past, I don't believe you can say that Perich and New Hope have any cross shareholding arrangement, as the phrase 'in bed with each other' might imply.

SNOOPY

Edit: Have just read the letter from Freedom Foods, which mentions an 'unnamed international dairy company'. I guess Arrowvest is an international dairy company through their direct investment in ATM. But why would Freedom foods not name them as the second party? Perhaps that second party is indeed someone quite unassociated?

It is interesting the different spin put on the respective announcements by ATM and Freedom Foods. Why would the second party choose to remain in the background? Could it be Fronterra, who have different rules on informing the co-operative members, compared to a listed company with shareholders?
Or is the fact that no such offer for ATM shares yet exists enough reason not to inform shareholders of whatever the second company is?

[gv1]

Ah well that's all solved then. No need to worry about doing due diligence if you are planning a takeover. Just pay the highest price paid during last years speculative bubble and all existing shareholders will be happy!

SNOOPY
Soo whats your take snoopy.

[Snoopy]

Soo whats your take snoopy.

The consortium will do due diligence, then make an offer based on that. The historical share price will be largely irrelevant.

SNOOPY

[Snoopy]

Not sure what part of the following you failed to understand Snoopy?

Two of Australia's biggest dairy farming families have formed a dairy consortium backed by Chinese investment. Moxey Farms, in central-west New South Wales, has entered into an agreement with Leppington Pastoral Company, which forms part of the Australian Fresh Milk Holdings consortium. The deal develops a four way partnership between the Moxey and Perich families, Chinese private company New Hope Dairy Holdings and ASX listed food processing company Freedom Foods.


Ah OK, you have more information. Thanks KW.

It looks like the implied two consortium bid:

"a consortium comprising Freedom Foods and an unnamed leading International liquid dairy milk Company."

is actually a four consortium bid with the Australian interests grouped as one entity and the Chinese interests grouped as another.

New Hope is masquerading as a private company, but things were pretty much centrally controlled in 1982 when it started. I also notice that under 'industrial structure' on the New Hope website there is following quote:

"NHG is highly evaluated as the successful enterprise for overseas investment both by Chinese government and local governments overseas."

(refer to http://www.newhopegroup.com/EN/Business.aspx?CategoryID=10)

I think New Hope is still effectively a Chinese Government investment vehicle, despite the image that those non-Chinese faces smiling back at you from the website are trying to give you!

SNOOPY

[sb9]

Its still going all guns blazing on ASX, currently 68c as I type, another fun filled day tmrw on NZX I guess...

[sb9]

Stop the press...

Its US Dairy Company that's interested...

US-giant Dean Foods Co in bid for a2 Milk Company

http://www.afr.com/street-talk/usgiant-dean-foods-co-in-bid-for-a2-milk-company-20150623-ghvf68


United States-listed Dean Foods Company is the mystery bidder circling New Zealand's a2 Milk Company, having teamed up with Australia's Freedom Foods in a bid for the company.

Dean, America's largest processor and direct-to-store distributor of fluid milk and worth $US1.6 billion, is understood to be keen to help a2 Milk Company distribute its products in the United States.

a2 started selling products into the California region in mid-April and has told investors that the United States is one of its key growth markets.

a2 milk revealed the takeover interest on Monday saying it had received an expression of interest from two associated trade parties. (http://www.afr.com/business/agriculture/a2-milk-company-plans-capital-raise-fends-off-mystery-suitors-20150622-ghukdx)

ASX-listed Freedom Foods later outed itself as one of the two trade parties and said it was working with a "leading international liquid dairy milk company".

It's understood Moelis & Co is advising the bidding consortia, while Goldman Sachs is working for a2 Milk Company.

[iceman]

Good score sb9. It will be interesting to see market reaction tomorrow !

[sb9]

Can tell you its 71c on ASX right now...

[iceman]

Can tell you its 71c on ASX right now...

It will not be stopping anywhere near that level !

[vin]

Screaming buyin now opportunity?

[Joshuatree]

Great sleuthing sb9. I was so close to bailing out of ATM for other opps with more immediate upside; or so i thought.Phew!

[NT001]

Well as I said yesterday, an American buyer makes more sense tome than a Chinese one. And although Deans is a part of Big Dairy, it does focus on meeting the needs of health-conscious customers and is not afraid to differentiate its products from the stadard milk generally available. For example its farmer suppliers are required to NOT use artificial growth hormones which have become one of the big concerns of health-conscious American consumers.

http://deandairy.com/newscenter.php?artificial_growth_hormone_free_milk

So as a shareholder who wants to see the scientific research underlying A2 continued and expanded and incorporated into general consumer knowledge, my first reaction is that a Deans takeover could be a positive development, quite apart from the likelihood of a worthwhile offer for our shares.

[blundoon]

sb9, thanks for posting the AFR article re US company Dean Foods. Now we can all have a break from Snoopy's rambling speculations.

[Sideshow Bob]

Can tell you its 71c on ASX right now...

Closed at 68.5 cents. Which these days equates to 77c in kiwi dollars. What's going to happen tomorrow day? :eek2::cool::confused:

[drcjp]

Yes tommorrow will be interesting, more so than today. Am predicting scream out of blocks tommorrow but then slight retraction later this week as offloaders run out.

[gv1]

or maybe expressing the desire to sell only a few months ago was all part of the plan to bring the share price down.

Yes, thats exactly I thought when I was away from the net....as snoopy said they will they the due diligence. They have done the due diligence that's why they bought in june.-Arrovest. Since they want to buy more than 20%, they have to give notice, while waiting to do this they bring all sort of nuisance.

[NT001]

FWIW, a few details gleaned from Wikipedia.

Dean Foods is an American food and beverage company that specializes in dairy products. It maintains plants and distributors in the US and UK and has 100 facilities located in 35 American states as well as five manufacturing plants in Belgium, France, the United Kingdom, and the Netherlands.

Its HQ is in Dallas, Texas, although its dairy section seems to be based in Pennsylvania. Its net income in FY2012 was $161m on revenue of $11,462m. Its total assets were $5.6 billion and it had 22,000 employees.

Dean Foods products include frozen and canned foods, dairy products and condiments. It produces milk in the US under a number of regional and national brands.

[see weed]

The part that hurts the most is that I have been patiently waiting for the downtrend to end before buying up a lot more. Looks like I miss out. I only have the little parcel I picked up in the last fakeout :crying:

I've been topping up for 11 months now form 69c down to 47c. But it's never to late. Sold some today for 68c and $750 profit, then bought slightly less of them back again for 71c:confused:. Had the order at 66c but missed out and had to pay 71c. I find with this stock, if you get a gut feeling, just do it, if you don't somebody else will. My gut tells me to keep buying at the moment. Get in before all those foreigners buy us out. 83,500,000 plus shares have traded in the last 16 trading days. Thinking of buying another lot tomorrow which will push average price back up to 56c...Just do it:t_up:

[Harrie]

Anything is possible in terms of how a deal is structured. Now that we have another entity coming in that makes it really interesting. I'm tending to side with KW here where there is some risk to existing shareholders if the deal is structured so that FF can get out or downsize their exposure and a2mc makes a cash placement to DFC which obviates the need for a CR.
This sort of move has been done by a2mc before when they made an institutional placement prior to listing on the main board. Existing shareholders were not offered a rights issue and the SP went from 0.58 to 0.50 overnight! (the price of the placement)
That's a possible negative. The positive is even if that happens the long term looks good and DFC will certainly help to get USA distributions and revenue firing. The market will react quickly to that potential, but again the potential needs to be converted to fact (also snoopys point)
In a previous post I indicated 0.76 on a DD and a 0.85 to 1.10 offer. That's only going to happen on a buy out, which per above may not happen if you read between the lines. a2mc have indicated that its more of a proposal scenario.

[Hoop]

The part that hurts the most is that I have been patiently waiting for the downtrend to end before buying up a lot more. Looks like I miss out. I only have the little parcel I picked up in the last fakeout :crying:


I would've done this too..Looks like ATM is bottoming out but lets be a well behaved disciplinced TAer and wait for more buy signals and that confirmational the bull/bear 58.5c resistance to bust.......That resistance has broken great news :cool: here we go ..bugger too late :scared: it gapped up...now what :mad ;::confused:

Dilemma time!!!:crying:
Damm..Buying now is big risk problem...eh? "Could this gap get filled"??....Would Murphy's Law apply, if I buy it will gap down, if I don't buy it will bust through 75c resistance and propel itself to 80, 90 or even higher due to the sudden less gap filler risk?

Sometimes awaiting entry using TA can be a total bitch...eh?...been there done that...and I've proved Murphy's Law many times as well..
Best of luck Mate

[kizame]

The part that hurts the most is that I have been patiently waiting for the downtrend to end before buying up a lot more. Looks like I miss out. I only have the little parcel I picked up in the last fakeout :crying:

I know exactly how you feel,sold out at 57 hoping it would trail back down to early 50s,and the rest is history,high and dry,oh well HNZ is trailing down so will watch for that bottom and pick up some more.

[blundoon]

From hotcopper.com.au

"a2 shares rose almost 20 per cent to 61c on news of the approach. Freedom shares closed almost 7 per cent higher at $2.99. “a2 has created unique dairy products with perceived health benefits that open up cow’s dairy to a raft of new potential customers,” UBS said. “We value the company at NZ$1.02 (90.4c) per share with upside to NZ$1.62 per share should we factor a full North America rollout and success in the Chinese milk market.” At the top end of the range this could see a2 valued at $950m.

reference http://www.theaustralian.com.au/bus...-bid-for-a2-milk/story-fn91v9q3-1227410131226 (http://www.theaustralian.com.au/business/companies/perich-kicks-off-dairy-wars-as-freedom-foods-leads-bid-for-a2-milk/story-fn91v9q3-1227410131226)
"

By the way the article above is Paid Content, if someone has access pls do summarise.

http://www.weeklytimesnow.com.au/agribusiness/dairy/perich-kicks-off-dairy-wars-as-freedom-foods-leads-bid-for-a2-milk/story-fnkeqg0i-1227410495352#comments

A couple of points: I made a polite comment on the website above, (which has not been published), about the inaccuracy of paragraph 11: "It is understood Freedom would have been prepared to continue the informal talks with a2 on a confidential basis, but a2 opted to disclose the approach to the market." They had the info completely around the wrong way, as it was Freedom Foods who 'outed' themselves, with their announcement to the ASX - a2MC has continued to maintain confidentiality. At 2:29pm (23/6) I received an email from Lachlan Hastings, the Online Editor for The Weekly Times stating:-

"Thank you for your comment posted on our story "Perich kicks off dairy wars"
For the sake of clarity, I have removed the paragraph, which originated in a copy syndicated from The Australian.
Thanks again for alerting us to the issue.
Kind regards,
lachlan"

As far as I can tell, this hasn't happened - yet.
The other point I note is that a2MC made a presentation on June 3 at the UBS Emerging Companies Conference.
Good luck to all holders!

[blobbles]

The part that hurts the most is that I have been patiently waiting for the downtrend to end before buying up a lot more. Looks like I miss out. I only have the little parcel I picked up in the last fakeout :crying:

This is the advantage of picking a company when its shaping up to have a big future and sticking to your guns. Seeweed and I have been advocating these guys for quite some time (as opposed to SNOOPY, who is a great contrary indicator I must say!) and buying as many shares at low prices as we can get, likely he is as "overweight" as I am. I aren't actually "overweight" as "morbidly obese" in ATM now! In our opinions (I am speaking for Seeweed without speaking with him, danger danger!) ATM has been a hugely growing future value proposition for quite some time. That it is being recognised now with a potential takeover offer is actually a bit sad for me as I would have loved to be hanging on for the ride! If that oppourtunity presents itself, I may just do that.

[Joshuatree]

Blobb of the month:t_up::p

[winner69]

So you buying up big time at these levels then Winner?

Been a good few weeks since that 'blow out' sub 50

Take it you in on the act as well ......in spite of the 'ifs' and 'maybes'

[see weed]

75c here we come.:)

[winner69]

We all had a good sleep and primed for the excitement that today brings

Instead of 95-110 estimate/guess I reckon it now 110-125 range ...whoopee

Really depends on how much extra cash needed to get US moving (wonder how much they were going to raise?) which could temper what they prepared to pay.

[okay]

Well done on your conviction blobbles, and certainly if anyone was more deserved it would have to be you see weed. Been a very interesting and at times frustrating hold this one. Will be fascinating to see how things play out from here.

[Nasi Goreng]

For every cent that the NZD drops against USD, we should be expecting the share price to reflect that. It hasn't been the case so far as share price was falling and so was NZD so in real terms the price has been tanking.

This is an international company with huge potential and Fund managers (and many others) bought it at $0.90 when the NZD/USD was in the 80's. We need to back ourselves and fight to keep this company in our hands or get a price for it which truly reflects the potential value of it.

[nextbigthing]

Been a good few weeks since that 'blow out' sub 50

Take it you in on the act as well ......in spite of the 'ifs' and 'maybes'

Affirm Winner. I've went with the behavioural theory that there'd be the flaw of conservatism bias on Monday when this was announced. Sure enough as people are slowly adjusting their beliefs to what has happened and getting used to ATM now being 70 cent range, the price has been ticking up accordingly.

I couldn't believe when it dropped back down to 66c. Someone just announced a takeover and it was up only approx 10c!

Has been a good week. Efficient market, pffttttt.

[Sideshow Bob]

Well done to the obese and morbidly obese!! :t_up: Congratulations on your convictions, in buying more and at those lower levels. :cool:

I am looking forward to the ride to come, and should be interesting over the coming days/weeks. Just hope if a takeover does happen, it is full & fair value - but that is so hard to judge.

Unfortunately I'm on A2 lite, only 7% of portfolio and bought in the mid-60's. But puts a bit of excitement in the game, just like buying into NZR recently. Trying to make up for the long painful death at NZO......

[Sideshow Bob]

Closed at 68.5 cents. Which these days equates to 77c in kiwi dollars. What's going to happen tomorrow day? :eek2::cool::confused:

77c already

[drcjp]

Have been thinking a bit on this. Exit timing is everything. Major concern is "is the takeover bid real?" - have come to the conclusion it might be as neither Arrovest or Freedom Foods will be wanting the price to tank now from such levels, which would happen if it all falls over. Thus I would expect a successful takeover bid to wait no more than 12 months to sort a NYSX listing and ride the gravy wave to kingdom come.

I have no idea what a valid buy price would be but I don't care anymore - too busy looking at new Range Rovers :D

[sb9]

I would like to play till the end, no matter which way the game plays out. Even if the takeover was to fall thro', by now we all know what the potential market out there on global scale (more so in US).

[see weed]

Well done to the obese and morbidly obese!! :t_up: Congratulations on your convictions, in buying more and at those lower levels. :cool:

I am looking forward to the ride to come, and should be interesting over the coming days/weeks. Just hope if a takeover does happen, it is full & fair value - but that is so hard to judge.

Unfortunately I'm on A2 lite, only 7% of portfolio and bought in the mid-60's. But puts a bit of excitement in the game, just like buying into NZR recently. Trying to make up for the long painful death at NZO......

How many shares do I have to buy to be obese? Has my last order gone through yet at 76c?:cool:.

[see weed]

Come on someone, sell me your shares, There is only 3736 to go to full order:D

[gv1]

Whose selling it at these prices anyway.

[Harrie]

I would not be getting too excited yet. There is still a chance that the proposal is nothing more than a placement of shares to bank roll further rollout in the USA. I'm a long term holder but I must admit ATM now represents a tad under 50% of my NZ portfolio at current prices.
Prefer to look at the FA rather than the TA which is why some of the TA boys have been caught short.
My prediction is as I have already stated that until we have more information on what this "proposal" is all about that speculation will keep it in the 0.75 to 0.80 range.
The aussy market seems a bit more buoyant than the NZ market with the $NZ equivalent buyers at around 0.78 compared with plenty of sellers around 0.77 on the NZX at the moment.
Should be an interesting day!

[ddrone]

Early days but Aussie currently looking like it will open at +70c so 79c NZ.

[gv1]

ok....I think its worth a lot more.

[ddrone]

Now 72c on ASX / 81c NZ....

[Ginger_steps_]

I was kicking myself a few of days ago for selling out of SUM and buying more ATM... Now im pretty happy with the outcome. Also happy to sell them for anything over $1.30 as it would be a nice chunk out of my home loan for now. I stupidly watched a massive profit in XRO wither away - keeping a close eye on this puppy now!

[Harrie]

Now 72c on ASX / 81c NZ....

Has the aussy market actually opened yet?

[sb9]

Open at 10am their time or 12 our time...

Looks like 75c opening if the depth is anything to go by...however there are always pre-open adjustments, so bit hard to read thro'.....

[ddrone]

Match price is still 72c AU, interesting that NZ hasn't risen to meet as yet, huge gap.

[nextbigthing]

The current AU match price is AU69c

AU69/0.8869 = NZ78c (0.8869 being current exchange rate).

Current NZ price 77c so about right. No real arbitrage opportunity.

[robbo24]

After reading this thread I think I'll invest in downstream speculation instead.

Dulux Group Limited (DLX.ASX) is a provider of quality paint.

Seeing as there is so much yacht-painting going on here there is sure to be a rush on this stock.

Although, I've seen yacht-painting before... Sometimes people don't realise they're painting with blood (as it runs down the street) before it's too late :D

[sb9]

yes a simple placement to a cornerstone investor.....especially an added value investor would be far better than a full take over

Absolutely, would rather stick your niche and grow big in the longer term than short term speculation.
Know lot on this forum are taking big speculation at current levels, only advice is tread with caution guys....

[winner69]

What's the score in Aussie sb9

Mine not working

[sb9]

Not sure either...no trades yet???

[tomblu]

What's the score in Aussie sb9

Mine not working


Mine not working either - are you with FPMarkets by any chance

[thestg]

Trading hault
Notice Pending

[stoploss]

Mine not working either - are you with FPMarkets by any chance

The ASX has then as notice received so suspended pending that by the looks of it.

[okay]

Looks like one of the exchanges has stuffed up.

Another article to read while waiting..

http://www.farmonline.com.au/news/agriculture/agribusiness/general-news/a2-bid-paves-path-to-us/2735885.aspx

[bucko]

Update on expression of interest





As previously announced, The a2 Milk Company Limited ("a2MC") has received an


indicative, conditional and non-binding expression of interest from two


parties with respect to an acquisition of all of the shares in a2MC.





ASX has requested in response to media speculation that a2MC confirms the


identity of the parties who submitted the expression of interest. The


parties are Freedom Foods Limited and Dean Foods Company.





The Board is continuing to seek further information in order to evaluate the


proposal and will update the market on further developments as appropriate.





a2MC has no further comment to make at this time.

[see weed]

nzx frozen also:confused:

[robbo24]

https://www.anzsecurities.co.nz/directtrade/dynamic/announcement.aspx?id=3897971

It's indicative...

It's conditional...

It's non-binding...

It's an expression of interest...

It's everything you need to know to throw every last cent you own at ATM.NZX - why wait?

Throw your chart, your spread sheet, your calculator out the window today!

:D

[vin]

I'm getting caught in the hype.. #chewsnails

[NZSilver]

POP GOES THE SP - $1?? +

https://en.wikipedia.org/wiki/Dean_Foods

[tomblu]

ATM: Update on expression of interest
12:48pm, 24 Jun 2015
..... ASX has requested in response to media speculation that a2MC confirms the identity of the parties who submitted the expression of interest. The parties are Freedom Foods Limited and Dean Foods Company. ...

[NZSilver]

Well im very suprised share price reacted in this way. Im buying a few more. Still risk but id say a company like deans has seen there success in Aus and now they are in their backyard want to own a2.

[nextbigthing]

While there's still risks involved as alluded to, whats the IP alone worth to a company like Deans?

Buy a company that will eventually pay for itself and get all that exclusive IP to be used throughout their massive distribution network for free... priceless.

[Joshuatree]

[QUOTE=KW;

If I had been as disciplined as I should have, I would have sold that parcel of 59c shares as the price dropped again. I held on only because ATM is my pet stock, and I figured we all get to have one LOL :p[/QUOTE]

Glad to know you're human KW, phew; thought you were a fembot for a mo. .BTW My pet stock is chicken.Hard to trade but boy does it create a short cut to flavour in amateur cooking.My maggi gives the perception of free range chicken just like A2 gives the perception of health benefits.

[robbo24]

While there's still risks involved as alluded to, whats the IP alone worth to a company like Deans?

Buy a company that will eventually pay for itself and get all that exclusive IP to be used throughout their massive distribution network for free... priceless.

Did you mean to post this in the PEB thread? :D

If not, did you copy and paste from the PEB thread and change the names? :D

[see weed]

Feel a bit sad about having to sell.Would like to keep a chunck for long term.I like the milk and would like to get divs one day. Same thing happened to fpa a couple years ago. Feel like deans wants to buy it before they start fully promoting it in the US. Reckon sp will be $2 to $3 one day when all those healthy Yanks start drinking it.

[nextbigthing]

Did you mean to post this in the PEB thread? :D

If not, did you copy and paste from the PEB thread and change the names? :D

ha negative, reread. I said 'company that will pay for itself' :D

[Snoopy]

Feel a bit sad about having to sell.Would like to keep a chunck for long term.I like the milk and would like to get divs one day. Same thing happened to fpa a couple years ago. Feel like deans wants to buy it before they start fully promoting it in the US. Reckon sp will be $2 to $3 one day when all those healthy Yanks start drinking it.

See weed, you don't have to sell. You will only have to sell if 90% of the outstanding shares are accepted into any offer. Since no offer yet exists and no price has been mentioned, it is being far too defeatest of you to suggest that you have to sell.

SNOOPY

[Harrie]

Can't understand the excitement. a2mc said from the very beginning that it was NOT a takeover bid...it was a proposal. What does that mean...only one thing, it will be a placement which will act as a cornerstone investment for Deans. It is of course possible that Deans will eventually move to acquire 100% but I can bet on the fact that they will want to gauge the success in the US market first giving it every possibility to succeed. This is all good news for current shareholders, however as I predict, a2mc with this exposure and interest moves to a different level. The placement will be around the 0.70c mark maybe a little below, but until growth in the target markets is proved the range will sit around the 0.75 to 0.80 mark (add a little speculation premium over the placement price)

[Harrie]

Now 72c on ASX / 81c NZ....

Really. never traded above 0.68c and dropped ever since.

[robbo24]

Can't understand the excitement. a2mc said from the very beginning that it was NOT a takeover bid...it was a proposal. What does that mean...only one thing, it will be a placement which will act as a cornerstone investment for Deans. It is of course possible that Deans will eventually move to acquire 100% but I can bet on the fact that they will want to gauge the success in the US market first giving it every possibility to succeed. This is all good news for current shareholders, however as I predict, a2mc with this exposure and interest moves to a different level. The placement will be around the 0.70c mark maybe a little below, but until growth in the target markets is proved the range will sit around the 0.75 to 0.80 mark (add a little speculation premium over the placement price)

Hear hear.

The question now is: where are the speculative/"momo"/hyped up buyer' stoplosses and how to exploit them when they are hit? :D

[sb9]

Can't understand the excitement. a2mc said from the very beginning that it was NOT a takeover bid...it was a proposal. What does that mean...only one thing, it will be a placement which will act as a cornerstone investment for Deans. It is of course possible that Deans will eventually move to acquire 100% but I can bet on the fact that they will want to gauge the success in the US market first giving it every possibility to succeed. This is all good news for current shareholders, however as I predict, a2mc with this exposure and interest moves to a different level. The placement will be around the 0.70c mark maybe a little below, but until growth in the target markets is proved the range will sit around the 0.75 to 0.80 mark (add a little speculation premium over the placement price)

Agree. I'll be happy if they made placement with Deans at around 70c and grow from there. At least that way we can all be part of bigger story when it eventuates in times to come.

[twotic]

Really. never traded above 0.68c and dropped ever since.

Re-read the context mate! you've misread it as it stands....

[robbo24]

No its very clearly a full takeover offer. "an expression of interest from two parties with respect to anacquisition of all of the shares in a2MC."
Now whether that actually eventuates is another question.

The full paragraph reads:


As previously announced, The a2 Milk Company Limited ("a2MC") has received an indicative, conditional and non-binding expression of interest from two parties with respect to an acquisition of all of the shares in a2MC.

I think the triple qualification of a mere expression of interest makes it pretty clear that it is not a full takeover offer...

Whether a full takeover offer eventuates is the real question.

[robbo24]

That's just normal legal language for "we are not making a formal offer at this stage because we havent done due diligence or decided a price and you cant sue us if we change our mind". But if it was not a full takeover offer in the pipeline or in the offer, they would not have said ALL shares, as that is now legally binding on them - they can't turn around and do a partial deal as then they will be charged with misleading the market, manipulating the price, etc. But a full takeover offer may not eventuate as they are free to withdraw their expression of interest (which will also require notification to the market). After that, they could put forward a second proposal.

I'm not sure it is "normal legal language", KW...

I don't see how a conditional, non-binding, indicative expression of interest can be a full offer or a partial offer under the Takeovers Code (http://legislation.govt.nz/regulation/public/2000/0210/latest/whole.html#DLM10106).

And if it was, as you say, an offer under the Takeovers Code, the market manipulation provisions under s 262 of the Financial Markets Conduct Act 2013 (http://legislation.govt.nz/act/public/2013/0069/latest/DLM4091370.html#DLM4091370) arguably would not apply thanks to s 263 (http://legislation.govt.nz/act/public/2013/0069/latest/DLM4091371.html)...

I'm interested to see other examples of conditional, non-binding, indicative expressions of interest of takeovers.

It could just be that A2 Milk had no choice but to announce the conditional, non-binding, indicative expression of interest because it was material even though it isn't even a realistic prospect...

Think about it :D

[Harrie]

Initially a2mc stated that it was not a takeover offer. I guess what that could have meant was that it was not a formal offer. It was just a friendly proposal to see how a2mc would react to a formal offer for all the shares.
I doubt that the terms of the expression of interest would have changed in its intent over just a day.
In this case then I go along with what KW is saying. But it is still not a formal offer yet.

[robbo24]

No its very clearly a full takeover offer. "an expression of interest from two parties with respect to anacquisition of all of the shares in a2MC."
Now whether that actually eventuates is another question.


That's the point, its NOT! Its an expression of interest. For all of the shares. At some point it may become an actual takeover offer. Or it may not. But they have stated the terms of the expression of interest (all of the shares) and the market is reacting to that. To do otherwise will attract penalties for misleading and deceptive conduct and market manipulation.

These two quotes convey different messages, then, don't they? :D

[Snoopy]

No its very clearly a full takeover offer. "an expression of interest from two parties with respect to anacquisition of all of the shares in a2MC."
Now whether that actually eventuates is another question.


If Freedom is involved and they already own 20% of the company, they will have to bid for at least 51% of the company. That would be a partial takeover offer. However they could make a full takeover offer and kneecap it by offering a derisory price which many investors would not accept. That way they would not have to stump up the cash for a full takeover of ATM, yet could still take control by taking out those investors that did sell out.

SNOOPY

[nextbigthing]

I could show an expression of interest in a beautiful women.....she may not be so keen on what I have to offer.

haha

https://www.youtube.com/watch?v=0iyeUcFKRv4

[nextbigthing]

lol.......are you any closer to that yacht yet

Yes thanks to this week! However I wouldn't go buying a new pair of boat shoes just yet. Give me a little longer :D

[robbo24]

Ah, sorry - badly worded. I will fix.

"No its very clear that they intend to make a full takeover offer. "an expression of interest from two parties with respect to an acquisition of all of the shares in a2MC."
Now whether theyactually make it is another question."

Better?

Indeed.

Although it's an interesting process being followed here.

Section 41 of the Takeovers Code prescribes a process that much be followed. A notice of intention to make an offer must be accompanied by documentation set out in Schedule 1 of the Code. This must be disclosed. A formal full or partial offer follows later.

What we have here looks like something else. The Takeovers Code cannot be contracted out of. The Takeovers Act also includes an offence of the usual misleading/market manipulation but extends it to "any transaction or event regulated by the takeovers code or incidental or preliminary to a transaction or event that is or is likely to be regulated by the takeovers code..." But how is anyone meant to know the non-binding expression of interest (seemingly preliminary to a notice of intention to make an offer) is not misleading if it is confidential?

My question is this - is there other examples of a completely qualifified, confidential (keeping in mind the Code cannot be contracted out of) conditional (etc etc) expression of interest for a takeover? Is this really normal and on what basis? If not, why are they exempt from following the normal process just because they say it's non-binding?

I would expect a justifiable price rise on the basis of an s 41 notice with all the trimmings, but not this :D

[robbo24]

FIN.NZX started with an annoucement without much detail (https://www.anzsecurities.co.nz/DirectTrade/dynamic/announcement.aspx?id=3776850)...

Followed over a month later with an s 41 notice (https://nzx.com/companies/FIN/announcements/260094)...

Although I think to some extent you can distinguish between the airey, thinly detailed announcement of FIN and ATM to some extent... Something to ponder...

The only certain thing is that nothing is certain :D

[Lola]

Indeed.

Although it's an interesting process being followed here.

Section 41 of the Takeovers Code prescribes a process that much be followed. A notice of intention to make an offer must be accompanied by documentation set out in Schedule 1 of the Code. This must be disclosed. A formal full or partial offer follows later.

What we have here looks like something else. The Takeovers Code cannot be contracted out of. The Takeovers Act also includes an offence of the usual misleading/market manipulation but extends it to "any transaction or event regulated by the takeovers code or incidental or preliminary to a transaction or event that is or is likely to be regulated by the takeovers code..." But how is anyone meant to know the non-binding expression of interest (seemingly preliminary to a notice of intention to make an offer) is not misleading if it is confidential?

My question is this - is there other examples of a completely qualifified, confidential (keeping in mind the Code cannot be contracted out of) conditional (etc etc) expression of interest for a takeover? Is this really normal and on what basis? If not, why are they exempt from following the normal process just because they say it's non-binding?

I would expect a justifiable price rise on the basis of an s 41 notice with all the trimmings, but not this :D

I was wondering when someone would ask this. I cannot recall ever another example of such a wishy washy announcement. Its a shambles. Where is the NZX here?? People are trading away in the dark. At the very least there should be a please explain or alternatively the stock should be in a trading halt.

[drcjp]

Indeed.

Although it's an interesting process being followed here.

Section 41 of the Takeovers Code prescribes a process that much be followed. A notice of intention to make an offer must be accompanied by documentation set out in Schedule 1 of the Code. This must be disclosed. A formal full or partial offer follows later.

What we have here looks like something else. The Takeovers Code cannot be contracted out of. The Takeovers Act also includes an offence of the usual misleading/market manipulation but extends it to "any transaction or event regulated by the takeovers code or incidental or preliminary to a transaction or event that is or is likely to be regulated by the takeovers code..." But how is anyone meant to know the non-binding expression of interest (seemingly preliminary to a notice of intention to make an offer) is not misleading if it is confidential?

My question is this - is there other examples of a completely qualifified, confidential (keeping in mind the Code cannot be contracted out of) conditional (etc etc) expression of interest for a takeover? Is this really normal and on what basis? If not, why are they exempt from following the normal process just because they say it's non-binding?

I would expect a justifiable price rise on the basis of an s 41 notice with all the trimmings, but not this :D

Interesting, which kind of makes me firm up a bit more on this being a real attempt. The Perich, FF and Dean foods teams MUST know that flying close to the wind like this and markedly affecting a SP could get them some pretty hefty "please explain" notices that won't be delivered in a nice fashion. Why would they bother for that grief just to take a look and say "yeah nah"?

[Harrie]

My question is this - is there other examples of a completely qualifified, confidential (keeping in mind the Code cannot be contracted out of) conditional (etc etc) expression of interest for a takeover? Is this really normal and on what basis? If not, why are they exempt from following the normal process just because they say it's non-binding?


Who is saying that they are exempt from following normal processes because the proposal is non binding Robbo?
How could an expression of interest not be deemed to be an intention under S41 of the take over code?

Its a bit like saying to your date "how would you react if I proposed that we slept together tonight". You could say that the intention was that you really did want to sleep with your date but wanted to gauge the reaction first. So its a bit hard to say that a proposal is not an intention otherwise why submit it!

I suspect because of the relationship between the parties that the expression of interest was a feeler as to gauging the reaction of a2mc to a full takeover.
In this case a2mc would have been in breach of the TO code if the expression was not tabled to the market

[robbo24]

Who is saying that they are exempt from following normal processes because the proposal is non binding Robbo?
How could an expression of interest not be deemed to be an intention under S41 of the take over code?

Because notice under s 41 requires very specific disclosure and formalities. That's how. It's nothing like your dating experiences at all.

So in FIN the offeror approach the majority holder..
In another example the company acquired 10%...

Haven't read the rest yet but it seems to me there's a missing piece of the puzzle here.

[Bjauck]

"The a2 Milk Company Limited ("a2MC") has received an indicative, conditional and non-binding expression of interest from two parties with respect to an acquisition of all of the shares in a2MC."

I mean the last part sounds like a full takeover but the rest of the announcement makes it sound like it was an idea mentioned at the local pub. You think you are being offered a powerful cocktail but you could end up with orange cordial...

[NT001]

One assumes at this point that the "proposal" included no option for a partial takeover or other arrangement short of a full takeover such as cornerstone placement. But presumably that can all change when FF-Deans have done due diligence and get into discussions with ATM. Incidentally, FF would already have access to most of what they need to know, since they have a member on ATM's board.

My guess is that it would be relatively easy to get 51% at somewhere approaching $1 but pretty difficult to get 90%. I'm sure even Milford would have its price, and likewise Cliff Cook (Mountain Road Investments), but there are some holders, large and small, who are firm believers in the A2 proposition and would be keen to ride this project out.

I can't see myself selling my whole stake, although I might sell part and hold the proceeds to meet a possible cap raising. Call me old-fashioned, but I feel a sense of obligation to honour the memory of Corran McLachlan and Howard Paterson by trying to keep a chunk of the old firm in NZ hands and keep the original A2 proposition alive.

[winner69]

Now that a2 have been forced to officially disclose who the parties were (even though those parties didn't originally want to be disclosed) I would say there will others now doing serious number crunching and contemplating a possible offer as well.

A2 is in 'play' as they say even though Freedoms 19% could be seen as a hurdle ....but even some here say Freedom might be a willing seller at the right price.

Somebody probably will front sooner than later I reckon .....whoopee .....and best case a bidding war?

[NZSilver]

Whn you look - milford 9.8%, FNZC 5%, Super 5%? ACC?, these guys have a bit of power...

[loon]

So good to see mention of Corran McLachlan and Howard Paterson. It is very sad that the founders are not here to witness the growth of their work and vision.

[NZSilver]

Looking into Dean's - they are the biggest milk processor and direct distributor in the states and process 40% liquid milk consumed in the US according to one source I found. They have many many brands including an organic brand which has caused some controversy. So I'd say they have seen how A2 went in Aus and are thinking if they do well in the U.S. It will cut into their market share somewhat. They have the means to pick up the a2 brand and simply hook it into there processing / distribution infrastructure. I'd say either full takeover - quick buck but a little upsetting to see another good NZ company head overseas, or Dean's is onboard with shareholding which potentially would have a lot more upside long term - either way we will do well. We won't do so well if they just walk away, in that case it will be back to buisness as usual!

[NT001]

Silver, I'm not so sure it would be bad if Deans ultimately didn't make a bid. You can be certain their initial approach will have been very much noticed in the US dairy, retailing and beverage sectors and if it does nothing else it will have generated wider interest in A2, showing it to be a product that other big US companies should be taking notice of.

And there are ways Deans and a2MC could work together in the US market without Deans necessarily taking the company over. I'm thinking of a deal like that between a2MC and Muller Wiseman in England. Once the parties start talking, all kinds of options could come into play. A cooperative deal between a2MC and Deans would be the ideal outcome in my book. Deans has an immense network of farmers, processing facilities, connections to retail chains and a big milk distribution system. a2MC has the IP and understands the product, and I'm sure would be prepared to license Deans to use the a2 brand in the States. Money for jam, from which we could benefit.

[Xerof]

Spinning top today - markets undecided on direction. Tomorrow will be telling.

Robbo, does 'notice and pause' still apply?

[Harrie]

Because notice under s 41 requires very specific disclosure and formalities. That's how. It's nothing like your dating experiences at all.

So in FIN the offeror approach the majority holder..
In another example the company acquired 10%...

Haven't read the rest yet but it seems to me there's a missing piece of the puzzle here.

Not quite with you there Robbo.
Are you saying that a2mc is exempt from complying with S41 of the TO code because the proposal is non binding?
It seems to me that they have complied by virtue of the fact that they have made full disclosure of the expression of interest in FF & DFC acquiring all the shares in a2mc.
Am I reading you correctly here?

[bull....]

think I read a2 have a meeting in London on Monday and the consortium may give an indicative takeover price on the weekend

[winner69]

I note Dean Foods down 3.5% over night.
I think most of us agree at 75cps ATM shares are indicating much scepticism that this will turn into a full takeover.
I was trying to think of reasons why the market seems sceptical.
In my research I had a closer look at DEANS FOODS balance sheet and I think it is quite revelling.

assets at 31/3/2015
$2.5b of which $1.2b is high deprecating plant and equipment and only $30m cash and cash and cash equiv.
Liabilities at 31/3/2015
$1.95b of which $1.2b is combined long and short term debt.
So Deans Balance sheet is hardly screaming they have a war chest for take overs and a balance sheet loaded with this much debt would indicate any full takeover offer would be payed largely in script(shares) than cash.
This could well be where the valid scepticism is coming from.

I noticed all that debt as well

Don't make much money do they snaps.

But a2 is in play now --- watch out for other offers I reckon

Possibly quite a few interested

[winner69]

If any offer I can see 85 cents and the words 'a 30% premium to the share price before the expressions of interest were announced'

Sounds a great deal for a cash strapped not profitable company needing heaps of cash to grow.

So today's price sort of mid way .... 50/50 bet as it were

[see weed]

think I read a2 have a meeting in London on Monday and the consortium may give an indicative takeover price on the weekend

It would have to be higher than the 52 week high of 77c. I assume all the 90,000,000 a2 share buyers in the last 16 days, me included, will not accept anything under a $1. All the media attention in the last few days plus today's big headline in the herald on page b7 in big black print "Pursuit of A2 Milk pushes shares higher". It all adds to the hype and buying frenzy like sharks in for their full. Would not be surprised if sp went to 79c to 80c today with new and old holders getting in on the act and maybe 90c to a $1 next week. I will buy another block today.:t_up:

[winner69]

It would have to be higher than the 52 week high of 77c. I assume all the 90,000,000 a2 share buyers in the last 16 days, me included, will not accept anything under a $1. All the media attention in the last few days plus today's big headline in the herald on page b7 in big black print "Pursuit of A2 Milk pushes shares higher". It all adds to the hype and buying frenzy like sharks in for their full. Would not be surprised if sp went to 79c to 80c today with new and old holders getting in on the act and maybe 90c to a $1 next week. I will buy another block today.:t_up:

.....and then $1.50 by month end and the offer comes in at $3.00 and milfie and others hod out for 4 bucks

Exciting times







..and then it all falls in a big heap and share price goes back to 55 cents and MACS valuation remains at$1.10

[see weed]

yes remember what hype,speculation and broader media coverage did for the PEB share price......could well be the same here.

Correct me if I am wrong. Didn't a2 milk have over $110,000,000 sales in Australia alone?

[Joshuatree]

Down 2c to 73c twice as many sellers, 1.55 mill shares thru on opening.

[drcjp]

I wouldn't get too excited guys, as I said yesterday, the market will pare back this week with profit takers and there will be no further rises until more info comes to hand. DYOR but its not gonna be straightforward

[ziggy415]

[QUOTE=see weed;577962]Correct me if I am wrong. Didn't a2 milk have over $110,000,000 sales in Australia alone?
not a lot of profit tho seeweed....im sorry but i smell a rat in the system here somewhere and its called freedom...not long ago we were all wondering who was driving the share price down etc and why...and now we get on odd
maybe takeover offer with so many conditions...hope im wrong but sold a few just in case

[drcjp]

lol, having written what I just did, some lunatic is offering buy for 100c on the ASX.....crazy

[robbo24]

Not quite with you there Robbo.
Are you saying that a2mc is exempt from complying with S41 of the TO code because the proposal is non binding?
It seems to me that they have complied by virtue of the fact that they have made full disclosure of the expression of interest in FF & DFC acquiring all the shares in a2mc.
Am I reading you correctly here?

No, you're not reading me (or s 41 which does not include a step of sending "friendly email that can be announced and speculated upon willy-nilly") correctly.

Here's an example of an s 41 notice and appropriate disclosure (https://nzx.com/files/attachments/207238.pdf).

Here's what s 41 says:

41 Takeover notice
(1) The offeror must send to the prospective target company a notice in writing that—
(a) states the offeror's intention to make an offer under this code; and
(b) contains, or is accompanied by, the information specified in Schedule 1 (except clauses 1 and 4) stated as at the date of the notice.
(2) If the offer will include a regulated offer under the Financial Markets Conduct Act 2013, the notice referred to in subclause (1) must be accompanied by a copy of every relevant document.
(3) In subclause (2), every relevant document means every product disclosure statement or other document that must be registered or lodged with, or produced to, any of the following persons or bodies for the offer to comply with the Financial Markets Conduct Act 2013 (including any exemption granted under that Act or any mutual recognition scheme established under that Act) or with the laws of any overseas jurisdiction in which the offer of the financial products is to be made:
(a) the Registrar of Financial Service Providers (including any equivalent person or body in an overseas jurisdiction):
(b) any regulatory body (including a regulator in an overseas jurisdiction):
(c) any offeree of the financial products.
(4) The notice may contain, or be accompanied by, any additional information that the directors of the offeror determine could affect the decision of the offerees to accept or reject the offer.


All the details required in Schedule 1 (http://legislation.govt.nz/regulation/public/2000/0210/latest/DLM10702.html) must be with the takeover notice otherwise it is not a takeover notice. This must be disclosed to the market. No mention of "friendly email that can be announced and speculated upon willy-nilly." A takeover notice has seemingly not been given, and indeed if it has then the company is withholding it for reasons of some type of contractual confidentiality agreement...

Here's some good diagrams and information: http://www.takeovers.govt.nz/assets/Assets-2/Takeovers-Directors-booklet-linked2a.pdf You will note the diagram on page 4 refers a takeover notice. No mention of "friendly email that can be announced and speculated upon willy-nilly."

I'm still trying to figure out why companies are allowed to qualify their "not-a-takeover announcements", getting the market hyped up and then taking a wait-and-see approach to whether an s 41 notice arrives (or not). Still haven't worked this one out.

[Harrie]

Keep focused on the long term boys. Exposure money cannot buy even though the deal may not go ahead.
I'm a bit sceptical over Deans ability to take on more debt, having looked at the B/S, but Freedom is in there as well, so anything could happen. Worth waiting on balance of risk to see what comes out of it. Accept that until we get more details SP will drift around the 69c to 76c mark
Deans operate scores of different brands including Oak farms in Texas. If I'm not mistaken isn't this the farm that was advocating a2 only milk a year ago NT?

[winner69]

Wonder who else could be interested and updating their models / plans right now

[Harrie]

lol, having written what I just did, some lunatic is offering buy for 100c on the ASX.....crazy

Got the same bulls*** yesterday with buyers at A$0.72c which converted to NZ$0.82 before the market opened. Just someone hyping the market to sell into.
Wait until the Aussy market opens and can guarantee it won't start trading at anywhere near that level. There is no additional info.
Anyway why buy at A$1.00 when there is plenty to buy on the NZX at around A$0.64 (NZ$0.73)

[Xerof]

lol, having written what I just did, some lunatic is offering buy for 100c on the ASX.....crazy
Why don't you take the time to get up to speed with how the pre-market auction system works.

[Harrie]

Why don't you take the time to get up to speed with how the pre-market auction system works.

Yeah sure, lets see what it really does start at when it opens shall we?

[NT001]

Actually Xerof that's something I've often been curious about and searched the Net without success. Could you briefly educate those of us who aren't familiar with it? Thanks

[robbo24]

Actually Xerof that's something I've often been curious about and searched the Net without success. Could you briefly educate those of us who aren't familiar with it? Thanks

Chuck High Frequency Trading into your search as well.

[bull....]

In reality the conditions of the bid are breached in that a2 revealed the identity of the parties and now the parties can walk away if they like so risk is large for any buyers now I would think

[bull....]

Fonterra stays mum on A2 speculation - nbr

be good if company stayed in nz hands

[Crackity]

Crikey it's a laugh a minute around here!

next thing you know Balance will be allowed back!

[Nasi Goreng]

Or FSF, thats a good article on NBR, thanks Bull.

Imagine if this got into a 2-3 way battle? Who's next, Nestle, Berkshire?

[winner69]

Or FSF, thats a good article on NBR, thanks Bull.

Imagine if this got into a 2-3 way battle? Who's next, Nestle, Berkshire?

A2 definitely in play ......models and plans being updated across the world

[Harrie]

Crikey it's a laugh a minute around here!

next thing you know Balance will be allowed back!

I would like to get some comment from MAC. When is he allowed back, anyone know?

[Xerof]

Actually Xerof that's something I've often been curious about and searched the Net without success. Could you briefly educate those of us who aren't familiar with it? Thanks

For NT and Harrie

Each morning before the open, trades are entered (but not dealt) and the system works out a match price and amount. At ~10am, the matching occurs at the match price, NOT at the actual buy and sell prices. The high buy prices, and low sell prices merely decide the order of execution of the trades. Same happens at the close, between 4.45 and 5.00pm.

I tried to find some old stuff that I had read on ASX but couldn't find it. Here is a screen shot of A2M moments before 10am open, which should make it all clear. e.g., the 'idiot at 100, gets them first, but at 66, not 100.

7441

You can see the match price is 66, and the match volume is 192,032. So in this case the sellers below 66 all get traded, and the sellers at 66 only get a partial fill, leaving the open market price as 65.5/66

Hope this assists

[winner69]

For NT and Harrie

Each morning before the open, trades are entered (but not dealt) and the system works out a match price and amount. At ~10am, the matching occurs at the match price, NOT at the actual buy and sell prices. The high buy prices, and low sell prices merely decide the order of execution of the trades. Same happens at the close, between 4.45 and 5.00pm.

I tried to find some old stuff that I had read on ASX but couldn't find it. Here is a screen shot of A2M moments before 10am open, which should make it all cleanr. e.g., the 'idiot at 100, gets them first, but at 66, not 100.

7441

You can see the match price is 66, and the match volume is 192,032. So in this case the sellers below 66 all get traded, and the sellers at 66 only get a partial fill, leaving the open market price as 65.5/66

Hope this assists

Very good Xerof

The ASX did have a paper on this, I couldn't find it either

[NT001]

For NT and Harrie

Each morning before the open, trades are entered (but not dealt) and the system works out a match price and amount. At ~10am, the matching occurs at the match price, NOT at the actual buy and sell prices. The high buy prices, and low sell prices merely decide the order of execution of the trades. Same happens at the close, between 4.45 and 5.00pm.
Hope this assists

Many thanks Xerof. Much appreciated. Does this also explain the sales that are shown as taking place just AFTER the close?
NT

[ddrone]

Many thanks Xerof. Much appreciated. Does this also explain the sales that are shown as taking place just AFTER the close?
NT

I believe those are off-market. All sales in pre-close go through at match price at close (ie 5.00pm), same as open.

[Xerof]

Does this also explain the sales that are shown as taking place just AFTER the close?
NT In a word, no. There are a whole swag of different circumstances relating to after-market sales. I am not entirely familiar with them really. If you spoke to one of the 'prime' brokers, maybe they would be courteous enough to explain it to you, but usually, it's the institutionals sorting themselves out at an aftermatch function

[Harrie]

Familiar with how that all works Xerof, You should have been directing that to drcjp. I was trying to explain to drcjp in a non technical way why a bid means nothing in terms of where the market is actually at when it opens. Have to be stupid to put a bid like that when the NZ market is trading significantly lower.

[see weed]

I put in a bid 72c at 4.55pm and they sold them to me for 71c at 5pm:)

[vin]

I put in a bid 72c at 4.55pm and they sold them to me for 71c at 5pm:)

I like your confidence, it's reassuring :p

[baller18]

guys, I don't quite understand, freedom foods has a MC of 560mil, and with ATM at nearly 500mil? They would do a full takeover at like 80 or 90 cents plus? Does not quite make sense... At 80 or 90 cents, ATM would be valued more than freedom, ATM should just do a takeover for freedom foods? lol
Which therefore, leaves only dean foods in the picture?

[NZSilver]

Baller - Remember they already own 20%, and the Periches another 20% (linked but not directly relevant to t/o) - there's 200 mil, Dean's isn't quite in the best financial position or as big as I originally thought when they were named - initially I though it would be cheap as chips for them and they would have the cash. Turns out it's not the case. Dean's on board would be good with their distribution chain. However another company coming in for an offer would be the best we can hope for. SP is saying this is unlikely to happen, which I'm suprised about, I thought it would be 90-100 cents - but I'd say some people either know more than me and think/know there isn't going to be an offer. And it sounds like the financials of Dean's would make a takeover a stretch. So that leaves another swooping in - but who would be interested? I'm not sure... A2m isn't exactly your traditional dairy company.

[NT001]

Remember they (Freedom) already own 20%, and the Periches another 20%

Are you sure? I think they own just under 20% between them. Freedom has about 19% and the Perich family own 60% of Freedom and thus control it. If either or both-combined exceed 20% of ATM they HAVE to make a takeover bid. As far as I'm aware, the Perich family's Arrovest has just a small stake on its own, which it had to declare because of its close relationship with Freedom. Or have I missed something?

[Joshuatree]

One day ban to to show that we Moderators do have a sense of humour :)

I don't get it. snaps gets a 1 day ban because he Didn't say something unacceptable> sorry can't see the humour here:confused:

[couta1]

I don't get it. snaps gets a 1 day ban because he Didn't say something unacceptable> sorry can't see the humour here:confused: Snapiti wont notice the day as he will be out gathering crayfish and other seafood delicacies so in a sense the Mods just gave him even more reason to head to sea for the day, sure he'll be back refreshed after his outing:cool:

[NZSilver]

Yeh sorry NT I'm mistaken and taLking smack.

[Harrie]

I don't get it. snaps gets a 1 day ban because he Didn't say something unacceptable> sorry can't see the humour here:confused:

Are you serious. Surely that's a joke, and if the moderator is trying to be funny, its not actually very amusing. Sorry but I do not see the joke in that.
I accept that personal abuse, bad language and stupidity should be moderated against, but that should never be extended to robust lively debate on different points of view backed by a logical interpretation of fact or opinion. Usually posters moderate each other.The line is pretty clear in my view.
Not sure what MAC and Balance were saying. Pretty sure it could not have been that bad to warrant a significant ban. Does anyone know how long this ban was for. Maybe Mr mod can help me out here?

[Joshuatree]

Come on in KW i know you are there:). A large number of "guests" tonite, lots looking at ATM for one. Come on sign on and share your thoughts.;)

[nextbigthing]

I see the ATM thread is now the new PEB thread. "Cool"

[NT001]

Remember they (Freedom) already own 20%, and the Periches another 20%

Silver, I've just been checking on this and I think you may have been misled by a mistake-ridden article in today’s ODT which quoted a ForBar source as referring to “Freedom's 18% stake in ATM, and further 19% in conjunction with Arrovest”. This is wrong.

In fact Arrovest, the Perich family’s company, filed an SSH with NZX on 9 June stating that for the purposes of Section 276 of the Financial Markets Conduct Act 2013, it had become a substantial shareholder in ATM by acquiring 8,698,655 shares, a mere 1.318% of ATM’s total shares.

This is because Arrovest owns more than 20% of Freedom Foods, which means it has a “relevant interest” in both its own stake and Freedom’s 117,699,229 shares (17.831%) – in other words a total of 126,397,884 ATM shares (19.149%).

The SSH notice is written in total gobbledygook (thanks to NZX) in order to make it very hard even for a ForBar analyst to understand, let alone the public, but that seems to be the guts of it.

In short, Freedom and Arrovest own 19.148% of ATM between them. Arrovest is not a party to the takeover proposal, but you can be sure it was behind it. The Periches seem very keen on A2.

Today’s ODT story also said erroneously that the rise in value of ATM’s shares from 57c on Monday to 70c on Wednesday raised ATM’s market cap from about $37.5 million to about $50m. Well both those figures were in fact 900% wrong – they were only 10% of the true market cap. Cheers NT

[see weed]

If this company gets sold, I'm thinking of buying my very own a2 cow to put in the back yard. Then I can drink whenever and not have to drive to Countdown. Might have some left over for $2.30c a litre. Yes, a drive through cow shed. How many litres from the udder do you think would come out of a cow? Anybody know? :confused:.

[stoploss]

If this company gets sold, I'm thinking of buying my very own a2 cow to put in the back yard. Then I can drink whenever and not have to drive to Countdown. Might have some left over for $2.30c a litre. Yes, a drive through cow shed. How many litres from the udder do you think would come out of a cow? Anybody know? :confused:.

Depending on the season , feed etc , 13/14 L a day

[see weed]

Depending on the season , feed etc , 13/14 L a day

Is that all. Would have to have 100 cows to make it worth while. Nah, think will stick to Countdown.

[baller18]

Thanks NT001, so how in the hell does freedom foods have the ability to buy out ATM??!!

[NT001]

Thanks NT001, so how in the hell does freedom foods have the ability to buy out ATM??!!

Well I don't really think FF does have the ability or the need/wish/reason to buy out ATM, although it does already have almost 20%. It could probably manage to push this up to 51%, especially with help from Deans. But according to research by some others on this thread, Deans doesn't have a lot of dosh either. The Perich family on the other hand are absolutely loaded. I'm inclined to think we might end up seeing a 51% takeover bid. Much more doable and far far cheaper, even though I can't see 31% of shareholders selling for less than about 95c, given that the SP was higher than that not long ago.

[QFD Sage]

What we need is as follows:
- The company to provide an update on the markets (particularly US launch) so that shareholders can make an informed decision on the current speculation.
- Fonterra to start buying a blocking position (at least 10%). I think that they must be interested from their "no comment" stance. If they were genuinely not interested they would have said that?
- current indicative interest to be sorted promptly one way or the other. If it is a partial takeover (my guess, and maybe for less than $1), then get on with making the bid!

[NZSilver]

Thanks NT - yeh I noticed that on the MCaps - horribly wrong. OFD - your onto it, but im not sure fonterra is interested, they never have been in the past. Maybe another dairy company, or maybe no one else really cares about A2

[Longhaul]

Not sure if anyone has posted this, but Google Trends can show interest in A2 Milk (or anything else for that matter).

http://www.google.co.nz/trends/explore#q=a2%20milk

[see weed]

876,985 have already traded at av price of 0.721701c before opening.

[sb9]

From hotcopper.com.au

"

http://www.theaustralian.com.au/bus...th-freedom-foods/story-e6frg8zx-1227415234184 (http://www.theaustralian.com.au/business/a2-confirms-disagreement-with-freedom-foods/story-e6frg8zx-1227415234184)

The Perich family, which owns 56 per cent of Freedom, has had discussions with Chinese dairy giant New Hope this week and is hopeful it may join with Dean Foods in a play for a2. Another unnamed Chinese buyer is also said to have expressed interest.

"

Looks like things shaping to be quite interesting...

[winner69]

From hotcopper.com.au

"

http://www.theaustralian.com.au/bus...th-freedom-foods/story-e6frg8zx-1227415234184 (http://www.theaustralian.com.au/business/a2-confirms-disagreement-with-freedom-foods/story-e6frg8zx-1227415234184)

The Perich family, which owns 56 per cent of Freedom, has had discussions with Chinese dairy giant New Hope this week and is hopeful it may join with Dean Foods in a play for a2. Another unnamed Chinese buyer is also said to have expressed interest.

"

Looks like things shaping to be quite interesting...

Sb9 - is that hotcopper as bad as ever. It was the biggest ramping site ever, even worse than here.

I got banished for life from that site and no matter how I try to rejoin they seem to block me (know my electronic footprint or something)

[winner69]

From hotcopper.com.au

"

http://www.theaustralian.com.au/bus...th-freedom-foods/story-e6frg8zx-1227415234184 (http://www.theaustralian.com.au/business/a2-confirms-disagreement-with-freedom-foods/story-e6frg8zx-1227415234184)

The Perich family, which owns 56 per cent of Freedom, has had discussions with Chinese dairy giant New Hope this week and is hopeful it may join with Dean Foods in a play for a2. Another unnamed Chinese buyer is also said to have expressed interest.

"

Looks like things shaping to be quite interesting...

Board room stoushes never a good sign.

Could get bitter,who wins then!

[zymwh]

http://www.theaustralian.com.au/business/a2-confirms-disagreement-with-freedom-foods/story-e6frg8zx-1227415234184

A2 confirms disagreement with Freedom Foods

The Australian
June 26, 2015 12:00AM

[drcjp]

Very interesting, Thanks for that zymwh. Makes a bit more sense of things now.

[babymonster]

still a lot of uncertainty regarding the takeover and/or CR

[Ginger_steps_]

still a lot of uncertainty regarding the takeover and/or CR Agreed, this sentence interests me "Another unnamed Chinese buyer is also said to have expressed interest." So splitting the takeover 4/5 ways makes the takeover a very real possibility still...

[JohnnyTheHorse]

http://www.nbr.co.nz/article/schism-emerges-between-a2-and-freedom-th-174743

This is going to get very interesting. a2 have made a disclosure breach by discussing capital raising plans with Perich 4 weeks ago. Perich has then bought a2 shares with knowledge of this breach, so is likely liable to insider trading. Could shake up takeover talks.

[drcjp]

http://www.nbr.co.nz/article/schism-emerges-between-a2-and-freedom-th-174743

This is going to get very interesting. a2 have made a disclosure breach by discussing capital raising plans with Perich 4 weeks ago. Perich has then bought a2 shares with knowledge of this breach, so is likely liable to insider trading. Could shake up takeover talks.

I'm sure Perich would argue he is major holder in FF, ipso facto he has right to know what goes on at board level in A2 thus not inappropriate?

[NT001]

Thanks Zymwh, yes that does clarify things. Nothing there surprises me very much. However, I can't say Freedom (controlled by Perich) have done a lot to help the SP since the dual listing, especially by announcing their stake was available for sale. And it seemed surprising that Perich relinquished its seat on the a2MC board not long ago, leaving just the Freedom representative.

I'd be uneasy about a Chinese takeover, or a takeover by a messy combination of Aussies, Chinese and Americans, although if Chinese are involved my guess would be that current shareholders would hold out for a much higher price. It seems to me that there would be too many conflicting motivations involved insuch co-ownership. The company's current strategy is taking some time to achieve huge returns, but that's inevitable and wouldn't change much under new ownership. And at least the current strategy and objective is very clear, and management is united on what it's trying to do, continuing in the footsteps of the company's visionary founders. It's getting there, and I think most of us are pretty happy with recent progress.

All this raises some pretty interesting issues. Are we really going to have America's biggest milk processor (Deans) plus a couple of Chinese government-controlled dairy giants and the Perich-Freedom consortium all publicly supporting the proposition that standard milk is indigestible by a large percentage of consumers? Not to mention it also being medically hazardous to a significant percentage? After all, that's A2's selling point. And if a2MC's new owners who are donkey-deep in mainstream milk are not prepared to come out publicly and say this, you have to wonder if they might prefer to continue jeopardising the health of the world's milk consumers by burying the A2 message.

Interesting that there is speculation about Fonterra. I don't have NBR access so I don't know the details there, but I think any bid by them at the moment would be unlikely. Even just a 10% blocking stake would cost it close to $50m, which would raise a few eyebrows among its farmer clients at this time of fiscal pain.

Fonterra's public stance in recent years has consistently been to rubbish the A2 proposition, even though its science chief Jeremy Hill played a key part in developing it. So it would be a backdown if it decided, for whatever reason, to put money into it. And it could possibly expose Fonterra to legal risks down the line. However, according to Keith Woodford, Fonterra does have a plan in its back pocket with regard to A2, which it may use at an appropriate time. Hard to guess what that may be.

On a2MC's side, I think there would still be a desire to work with rather than against Fonterra despite their past animosities if the latter were willing, partly for the sake of the NZ and Australian dairy industries as a whole. A lot of Fonterra's more clued-up farmer suppliers have quietly moved their herds towards A2 through selective breeding already. And the media columns written by Keith Woodford who is highly regarded in the dairy industry and has been strongly encouraging conversion to A2, based on his knowledge of both the science of A2 and farm economics, will undoubtedly have been making many farmers question Fonterra's stance.

Interesting days ahead.

[JohnnyTheHorse]

I'm sure Perich would argue he is major holder in FF, ipso facto he has right to know what goes on at board level in A2 thus not inappropriate?

Ideally all shareholders should be treated at the same level wrt disclosure. I suspect a2 approached Freedom to see if they would support a capital raising. Acting on that information is where the major breach occurs. FMA will do nothing, but being ASX listed we may see some fun from that bunch.

[drcjp]

Ideally all shareholders should be treated at the same level wrt disclosure. I suspect a2 approached Freedom to see if they would support a capital raising. Acting on that information is where the major breach occurs. FMA will do nothing, but being ASX listed we may see some fun from that bunch.

Agree but I suspect Perich may have done business this way in the past and be quite comfortable about it still.

[silverblizzard888]

Well it just sounds like The Perich Family just don't like how things are being run because they aren't getting the riches that everyone here probably expected A2MC to generate for them given how unqiue the product is and so they aren't concerned about owning majority share of the company they are more just interested in taking it over just to change the strategy of the company for more rapid returns. They want Dean foods in position just as a strategic play since they don't have much cash to splash, but they have the distribution and processing to accelerate the hell out of the potential this company has. I think FF are setting themselves and Dean Foods as strategic players and then offering this plan to a cash rich Chinese company to bankroll the takeover. It seems like that in my mind but take it as you will, the puzzle seems to come together when I think of it this way.

[winner69]

There is so much scepticism on this forum(me included) and given the current share price from the general markets as well.
I think we are all guilty of not being able to see the wood through the trees and I think it is very easy to lose focus on the macro picture here.
ATM once again are benefiting from a **** load of free market exposure due this latest development especially in the US with much more to come.
Furthermore the simple fact that a major US dairy company is considering taking all or a piece of our mighty fine company is reason’s enough for the share price to be re rated so to be perfectly honest I don’t believe the current share price has any premium in it considering a take over could eventuate.
The current share price also does not reflect the benefits that would be derived from a cornerstone share holder with the added value of the likes of which Dean foods has to offer.
Furthermore many of you wrongly assume FF and Deans Food will be the only ones interested in ATM
ATM have massive potential hence my comments in the past that they could be the next coke and don’t be at all surprised that more interested parties come out of the wood work. Personally I believe given a potential take over is circling and A2's potential I now expect it. I also now believe this is the intended game FF is playing.
The likes of Deans food don’t come out of the woodwork to show interest in over priced dogs with no potential so the fact that they are at the table shows that there is much potential in our company.
This company will not be solely purchased, if indeed it is purchased, based on it’s fundamentals but rather on it’s intellectual properties and future potential.

I shall now go back to fishing.

Good post snaps

Yes, a2 is in play. No doubt many are showing interest in both the company and the product as well.

I have a feeling there will be a surprising outcome to all this in due course, the games have just started.

Anybody mentioned merger / reverse takeover yet?

[winner69]

now that would be interesting and I think FF would only have a small role to play if any.
One feels compelled to go along for the ride......

You made a lot of dosh already mate .....why not see what eventuates ...... But be quick when it looks like it all over as it might go back to 50 cents

[NT001]

Interesting story here from the Sydney Morning Herald in which Freedom's boss says there's no big rift with ATM, and its decision to declare its stake in ATM as being available for sale was done for accounting reasons. That was actually made clear at the time, when Freedom had a lousy operating result and needed a bit of accounting hocus-pocus to make its overall result look decent.

http://www.smh.com.au/business/freedom-foods-says-a2-milk-relationship-strong-despite-surprise-takeover-bid-20150626-ghyhj3.html

[NT001]

If I were Babidge or a member of a2MC's board, I think my inclination would be to say that until we get an actual takeover proposal we will proceed with our plan to issue new shares. We won't just halt our future planning on the basis of some vague expression of interest. Let our shareholders see the colour of your money and then you can do due diligence, after which you can withdraw or revise your offer as you see fit. Could they do that? Babidge sounds a bit put out by the way the offer has come out of the blue, so couldn't he at least throw a bit of a spanner in their works by refusing to call off the cap-raise until they front up with a real offer?

[QFD Sage]

At the end of the day, this is a good news story. Great PR for ATM. Possible sale opportunity if the price is right. If not, hang in there for the long haul. Would love to be a fly on the wall in the ATM board meeting in London this week...!

[NT001]

that exactly what should of happened.
but consider this........FF have been trying to sell their stake..... then ATM approach them about doing a cap raise....this starts a disagreement between FF who are trying to get rid of their stake and know trying to sell their stake would be a lot harder to do with a cap raise hanging around(which is very true) so to generate some interest in their own stake and to halt the cap raise as well as take control of the situation they manoeuvre the game to the current situation.
The current position being cap raise on hold and interest being generated by other parties on buying a portion or all of ATM........... yet at the same time FF have offered nothing binding to ATM. Could be very good positioning by FF.

Do we actually know A2 went to FF about a cap raise? Some of the stories published so far suggest Perich raised it with Babidge. Perich would have known it probably because FF's director on the a2MC board, Melvyn Miles, would have learned about it at the a2MC board table (or in docs). I'm not sure whether Miles, as an independent director of FF who is also FF's rep on the a2 board, is ethically entitled to pass on a2MC's secrets to the FF board, but I presume that happens.

It seems at this stage that the main falling out is between Perich and Babidge, though it's not clear why Perich objects so strongly to a cape raise. Perich is in a position to make FF do whatever he wants, but officially he doesn't really speak for FF. Rory Macleod does, and he says he and Babidge have no problem. The internal dynamics of the Perich-FF combine are not entirely clear. It's also not clear that FF really want to sell their a2MC stake. According to Macleod, that's simply a future option, not a wish or short-term plan.

You say FF have cleverly managed to bring about a hold on the cap raise. Do we know that? Babidge said that demand by FF was a problem, and my impression was that it had not yet been capitulated to.

[see weed]

You made a lot of dosh already mate .....why not see what eventuates ...... But be quick when it looks like it all over as it might go back to 50 cents

I think buyers, my self included, would be buying hell of a lot more at below 55c. Would any one on this forum sell their shares for 50c? I will buy them.

[see weed]

yes but even if it does fall over and the share price goes back to 50cps I still believe I am invested in a great company that would just have recieved a **** load free marketing exposure(which is exactly what they need) in multiple markets.... so snaps thinks long term he cant lose by holding onto a few ...did not pay much more than 50 cps for them anyways:)

Yes, that's right.Good exposure. Are you in the top 100 Snapiti?:cool:

[NZSilver]

There is some good info getting posted here - solid research and some subscription articles for example. Thanks for sharing. Next week will be interesting. Speculation is rife at the moment, so an update is going to hopefully give us more clarity. I say hopefully.... Interesting ff put a2 up for sale for accounting purposes, this makes a t/o more likely in my opinion.

[ziggy415]

do you really believe that corporate propaganda.....fairly confident it is a red herring
beware not everything is as it seems with this one and the market is definitely trying to tell us something.
more red herrings than a fish market.....it wasn,t long ago we wondered who was driving the sp down...no change in holder notice even tho millions traded...then sp suddenly turns....milford who were a buyer suddenly becomes a seller....expansion funded from aussie sales then talk of a cap raising.....Perich suddenly tops up to 20%....freedom shares for sale but not really, only an accounting squiggle of the pen to make books look good.....then two buyers looking to do due diligence even tho one of them has a member on the board....but we buy only if no one else is looking and no more shares issued and only if no one knows who is looking thru the books.then Deans dairy popps up...throw in a couple of chinese firms and now were worth megga bucks but were still loosing money.....American market not yet bedded in but suddenly were going to take the world by storm.......its been a puzzle from the time the sp trended down...my take....freedom will sell and the rest of us will get left behind

[Snoopy]

Personally I hope ATM march on with their cap raise until something more formal is tabled......... but hard to do without the support of the major shareholder so I think FF have ATM snookered in that respect.


The problem is if ATM don't raise more capital soon, then they could run out of cash. The receiver would then have no trouble selling off the A2 Intellectual Property. But it would be the end of the road for all existing shareholders (including Freedom).

I have previously pondered why ATM would let themselves get into this cash crunch predicament (my post 3115 on this thread in February 2015) when clearly there were plenty of shareholders and potential new shareholders out there willing to put new capital into the company. I speculated that it was because one or more of the existing substantial shareholders would not stump up more cash to support such an issue. It turns out that I was exactly right!

SNOOPY

[RGR367]

My gut-o-meter says nothing will come out of this. Cap raising will proceed and so the sp will settle within 55- 65 range. It has to as my average bought price is 52 so really bad if it get acquired now. You Guys** should not let this NZ company get owned by another at its early stage of making a name for itself. GL to us all.

** hoping to win the Lotto Jackpot tonight to make a broadcasted offer on the company too. They'll glance at $23M offer on the table, right :D

[NT001]

The problem is if ATM don't raise more capital soon, then they could run out of cash.

Why? They are operating profitably and have cash in hand. All they would need to do is slow down their expansion plans. The plan to increase capital as far as I can see is simply in order to fund a faster growth rate in the US, which has to be their best market.

[winner69]

Freedom Foods been burning through the cash the last year or so.

[winner69]

It has taken me a long time to understand most of your one liners.
so might have to do a cap raise themselves or sell an asset to position their own company for growth ah............ me thinks they are well positioned to do the later

Freedom have had a bit of practice doing capital raisings in last year or two ....as well as borrowing money by the looks of it.

[QFD Sage]

So if a bid eventuates for full takeover, what price would people accept? I'd take $1 but would expect the opening bid to be at 85 cents. Hoping that the major shareholders then lever up the bid price to $1 +.

[NT001]

So if a bid eventuates for full takeover, what price would people accept? I'd take $1 but would expect the opening bid to be at 85 cents. Hoping that the major shareholders then lever up the bid price to $1 +.

My guess is that $1 would be too low for a full takeover. Which raises the question, who is going to stump up NZ$700m for a company that is still controversial and hasn't yet really proved it can make money outside of its "home" territory, Australia. I'm not knocking it, but that's the way it would be widely seen. And if the Chinese are involved in a motley takeover consortium, I think present shareholders would hold out for much more than that. Who needs it that badly? And who is going to call the shots?

A partial takeover for a controlling interest by a small tight-knit consortium makes more sense to me, but even then the buyers would need to have a good well-thought-out plan for what they're going to do with it. It's a highly specialised niche company which at the moment still has more enemies than friends in the global dairy industry and still has a long way to go to win international consumer confidence.

Anyway, we're still quite a way from the end of this story.

[Soldog]

So if a bid eventuates for full takeover, what price would people accept? I'd take $1 but would expect the opening bid to be at 85 cents. Hoping that the major shareholders then lever up the bid price to $1 +.

I for one hope the takeover doesn't happen, and I'd like to see the company go all the way. I think the team at A2milk have done an outstanding job to date! I hopefully look forward to holding for another 5+ years. Myself, I like the product and believe in the benefits of it. I think the company has a bright future if only we can navigate through all this. But if a takeover was to happen, I myself would be looking for around the $1.50+ mark. Aim high, why give the goose that lays the golden egg away! It has value! They want it for a reason!

[see weed]

I for one hope the takeover doesn't happen, and I'd like to see the company go all the way. I think the team at A2milk have done an outstanding job to date! I hopefully look forward to holding for another 5+ years. Myself, I like the product and believe in the benefits of it. I think the company has a bright future if only we can navigate through all this. But if a takeover was to happen, I myself would be looking for around the $1.50+ mark. Aim high, why give the goose that lays the golden egg away! It has value! They want it for a reason!

I agree fully with your post.... Unrelated....China's $30,500 billion ($30.5 trillion) of savings to start flowing overseas.... If I told you a2 would be trading at $2 in 2 years time, and paying 10c dividend, what price would it be worth then? Can another company start up and sell a2 milk in opposition to the a2 milk company? If another company can sell a2 milk, then I would also accept $1.50. You can sell an engineering company and start up another, but can you sell a2 and start up another? Once USA and China start drinking a2 milk, you wait, we'll all be kicking ourselves for selling out at $1.50c and their sales start to reach $1billion to $2billion. Have a nice day:).

[NT001]

Can another company start up and sell a2 milk in opposition to the a2 milk company? .... You can sell an engineering company and start up another, but can you sell a2 and start up another?

I have always admired your faith and optimism, See Weed, which I pretty much share myself. I do believe that if properly managed, a2MC couldl be worth at least $2 a share within 3-5 years if not sooner.

As to your questions, yes it would be possible to start up another firm on the A2 theme. Only problem is that the "a2" label has been well and truly trademarked and protected and you couldn't use that. A2-only milk is a scientific description of a naturally occurring product, not a manufactured invention of a2MC, so the company can trademark the name but not patent A2 milk as such. You could sell your product as something like "Seeweed's A1-free milk", but not as "Seeweed's A2 milk". And the science behind A2 is public property - you just have to read the peer-reviewed research papers, which a2MC itself publishes in a cautious way on the Net.


You might have some problems setting up A2 herds without access to a2MC's patented testing technology (using a single hair from a cow's tail). I don't know when a2MC's patent over that technology expires in various global markets. It's a complicated legal area. In America there are individual farms that advertise their milk as A2 because they've had their cows tested by the University of California (Davis) which has a licence from a2MC. Some of these farms developed A2 herds at the time when the then A2 Corporation was making its first commercial foray into the US about eight years ago, and are now eagerly lining up to participate in the new US operation. They're obviously not seen as a threat by a2MC.

Quite a lot of lifestyle farmers with just one cow (usually Guernsey or Jersey) have also had their cows tested, mainly for health-conscious reasons. But if you were to set up a rival firm, it would be interesting to see whether a2MC tried to stop you using the tail test or simply accepted the cash it gets from letting farmers use it.

You can also test the milk from each cow and establish its A2 status that way, but I believe that's more difficult and costly than the simple tail-test. I think Fonterra probably still owns some patent rights to the milk-testing method, from the days when it was fully endorsing the A2 health proposition (which it has since tried to deny).

Of course, a2MC itself has to continually test its milk for A2 purity anyway, for quality control purposes and to ensure compliance with consumer protecion legislation.

It's a slightly murky area, but yes, a new A2 company could start up, or a company like Deans could just develop A1-free milk as a health product. My own guess is that this will inevitably happen regardless of whether or not a2MC is taken ove. As the A2 health message becomes more widely understood and accepted, and credible human clinical tests confirm the links between A1 and autism and schizophrenia and SIDS for example, it will be a tempting area for commercial exploitation, especially in the health-conscious US. But care will be needed, as US law prohibits denigration of a rival product (standard milk containing A1).

[drcjp]

Looking at the Deans report from FY2014 http://www.deanfoods.com/pdfs/annualreport.pdf and their Q1 15 data, I'm not convinced they have the legs for this. They would seem to have a minor role at best.

[see weed]

Looking at the Deans report from FY2014 http://www.deanfoods.com/pdfs/annualreport.pdf and their Q1 15 data, I'm not convinced they have the legs for this. They would seem to have a minor role at best.

I have just read about 5 pages and got tired of reading, but notice at the bottom of page 5 the annual sales of fluid milk that goes into 90% of US homes is valued at about $20 billion (US). Deans have 68 manufacturing facilities in 32 states, with distribution capabilities across 50 states. As of 31 December 2014 their local regional proprietary and licensed brands numbered 57. a2 would make it 58. I could not read any more cos my eyes were going crossed and blurry. But I do think Deans might be a bit scared of a2 coming on the scene, and this could be the reason they want to buy it out -- to hide it in the bottom drawer - cos they have a lot to lose, if all their customers started understanding the a2 story. Correct me if I'm wrong. SW.

[ziggy415]

I have just read about 5 pages and got tired of reading, but notice at the bottom of page 5 the annual sales of fluid milk that goes into 90% of US homes is valued at about $20 billion (US). Deans have 68 manufacturing facilities in 32 states, with distribution capabilities across 50 states. As of 31 December 2014 their local regional proprietary and licensed brands numbered 57. a2 would make it 58. I could not read any more cos my eyes were going crossed and blurry. But I do think Deans might be a bit scared of a2 coming on the scene, and this could be the reason they want to buy it out -- to hide it in the bottom drawer - cos they have a lot to lose, if all their customers started understanding the a2 story. Correct me if I'm wrong. SW.
thats funny seeweed cos i read about the same number of pages but got a different take on it....to me debt was increasing while profit was dropping and only $16 million cash and that came from foreign exchange........maybe the different interpretation comes from your positive outlook but my not so slightly positive view after the odd takeover offer.....maybe someone with an accounting background can make sense of it....think im going to sell some more today

[baller18]

For the past few days there has been some off market trades before the opening.. One day there was a trader roughly around $1.5million dollars worth, and then another around 800k (can't remember exactly). Who is doing the buying? Anyone out there has any clues?

[robbo24]

For the past few days there has been some off market trades before the opening.. One day there was a trader roughly around $1.5million dollars worth, and then another around 800k (can't remember exactly). Who is doing the buying? Anyone out there has any clues?

The condition symbol is IN, so possibly transfers to ASX.

[NT001]

Yes, some blocks of shares have transferred to the ASX. For example, a list of the main NZX-registered shareholders no longer includes Freedom Foods. There has also been a drop recently in the number of shares held in custody by NZ Central Securities Depository (Reserve Bank), some of which would have been moved to ASX, although a few million have been sold down (eg by Milford and NZSF). Before the dual listing, NZCSD held 48% of ATM shares in custody, whereas a few days ago (just before the takeover talk) it held only 37%. With a dual registry it's a lot harder to keep track of share movements now.

[Snoopy]

Why? They are operating profitably and have cash in hand.


While strictly correct, the ATM operating profit was a mere $10k last year. Less money than the payment they made to their lowest paid part time cleaner. So within the margin of error ATM make no money, by design of course as all potential profits are being funnnelled into further market expansion. Nevertheless ATM effectively have no earnings and therefore no borrowing capacity.

As for having cash in hand, actually you don't know that.

What we do know is that plans to raise more cash are well underway. If there was sufficient cash about they wouldn't be doing that. We also know that cashflow from operating activities shrunk down from $3.647m in FY2013 to a mere $435k in FY2014. We know that the actual cash balance the company has shrunk from $20m in FY2013 to $16m in FY2014 (EOFY 30th June). We also know that due to taking legal action in Australia, cash costs going forwards will be higher than budgeted for. So I would guess the cash balance is now somewhat less than $10m based on those trends. Pretty pathetic for a company that the market values at more than $400m.



All they would need to do is slow down their expansion plans.


I suppose pulling out of the loss making UK market might help.



The plan to increase capital as far as I can see is simply in order to fund a faster growth rate in the US, which has to be their best market.


Probably true. But this doesn't change the fact that ATM are severely short of capital and they will not want to wind back their expansion plans before their intellectual property patents start to expire.

SNOOPY

[airedale]

I take your point Snoopy, that cashflow shrank from 2013 to 2014 but much of that was due to the then high NZ dollar. Was it a foreign exchange loss rather than an operating loss. ok a loss is still a loss...but ?

[NT001]

Snoopy, I think it's obvious that a2MC needs more capital if it is to step up its US expansion. That is very different from saying that unless it raises capital urgently it will have to call in the receiver who would then liquidate the company, starting off by selling off its IP.

You have also speculated that ATM is in crisis and on the verge of receivership because one of its major shareholders might not want to participate in a cap raise. There is no shareholder so large that it can stymy a cap raise by saying it wouldn't take part. It's up to individual shareholders whether they participate or watch their stake being diluted.

We know that ATM has been operating profitably in Australia and have no reason to believe that is not still the case. And do we know for a fact that it is still losing money in UK as you say? Even if it is, I would expect to hear soon that those losses are less than in the initial setup stage. China too should be looking better.

ATM has a gung-ho new US chief who wants to speed things up and has the background and experience to make things happen. I don't see a crisis.

[see weed]

Small amounts of about 5,000 shares keep on going through on the buy side every 2 or 3 minutes. Same thing happened a few months ago but it was the other way round, they were selling every 3 minutes, on one particular day.

[airedale]

Director, David Mair has just disclosed selling 250,000 shares. He is a fund manager for another entity as well as a director of ATM.

[NT001]

Looks weird. As at 3.45pm, there had been 314 trades at an average value of just under $3,500 - some far lower than that. Only on the NZX, not the ASX.

[Bjauck]

Looks weird. As at 3.45pm, there had been 314 trades at an average value of just under $3,500 - some far lower than that. Only on the NZX, not the ASX.
David Mair's disposal was by way of one transaction on the 24th June - if that is what you are referring to. He sold approx. 12% of his holding.
Maybe he thought a concrete bid was unlikely to eventuate....

[NT001]

David Mair's disposal was by way of one transaction on the 24th June - if that is what you are referring to. He sold approx. 12% of his holding. Maybe he thought a concrete bid was unlikely to eventuate....

No, there's no suggestion of a connection between the odd trading today and David Mair's transaction report. Mair, a former director who resigned just before the dual listing, still has 5 million ATM shares in his own name. He has not sold any of these.

In his latest notice he was reporting (as a former ATM director) that a trust company of which he is a director (Forte) has sold $250,000 shares. Not sure whether he was obliged to report this.

[winner69]

David Mair's disposal was by way of one transaction on the 24th June - if that is what you are referring to. He sold approx. 12% of his holding.
Maybe he thought a concrete bid was unlikely to eventuate....

Public Trust Forte Nominees sold these shares, not David Mair

Mair is a shareholder of that company, the reason for this disclosure.

He has said a few times he has nothing to do with the funds investment decisions. When they buy and sell things in ATM, SKL etc they bring him a piece of paper to sign to keep the regulators.

Unless some nudge nudge wink wink stuff going on you can't read anything into this announcement in so far as what Mair may know or not.

[Snoopy]

I take your point Snoopy, that cashflow shrank from 2013 to 2014 but much of that was due to the then high NZ dollar. Was it a foreign exchange loss rather than an operating loss. ok a loss is still a loss...but ?

If you look at note 28.1 of AR2014 Airedale (reconciliation of cashflows with operating profit) , it shows a foreign exchange gain of $1.448m,which is an increase on the gain of $0.545m in FY2013. The biggest single difference year on year seems to be a large increase in inventories $4.838m for the year. Last year saew an increase in inventories too, but that was only $65,000. Not sure why. Building up stocks for new markets?

SNOOPY

[Bjauck]

Public Trust Forte Nominees sold these shares, not David Mair.. My apologies. The perils of skim-reading the announcement. I saw 250,000, One transaction and Legal and beneficial owner!

[Kirk]

http://www.smh.com.au/business/jdcom-founder-richard-liu-taps-a2-milk-treasury-wine-to-rival-alibaba-20150629-gi0p98.html interesting read could be another investor to rival freedom

[winner69]

http://www.smh.com.au/business/jdcom-founder-richard-liu-taps-a2-milk-treasury-wine-to-rival-alibaba-20150629-gi0p98.html interesting read could be another investor to rival freedom

One news report last week said jd.com also had some agreements with Freedom

[winner69]

I see that amongst ANZ trades last week that A2 was the 2nd most sold stock, after PEB


Top 10 Net Sells: ranked in order of net value of sell trades minus buy trades, executed during the preceding week for ANZ New Zealand Securities retail customers.


Just a bit of useless information .... but might mean something to somebody

[see weed]

I see that amongst ANZ trades last week that A2 was the 2nd most sold stock, after PEB


Top 10 Net Sells: ranked in order of net value of sell trades minus buy trades, executed during the preceding week for ANZ New Zealand Securities retail customers.


Just a bit of useless information .... but might mean something to somebody

Bit more useless info....98,909,000 shares sold in last 20 days. 1.1million tomorrow will make 100,000,000 sold. Maybe Deans etc. will not have to make an offer, just buy them on market. Plenty of sellers. When they dry up and stop selling,is when sp may creep up again. Then FF & Deans will have to come in and offer the last few of us share holders $1.50c. Then we'll say, well i was thinking more like $2.50 this year:D.Maybe a lot more next year. Good night happy dreams:).

[ziggy415]

Bit more useless info....98,909,000 shares sold in last 20 days. 1.1million tomorrow will make 100,000,000 sold. Maybe Deans etc. will not have to make an offer, just buy them on market. Plenty of sellers. When they dry up and stop selling,is when sp may creep up again. Then FF & Deans will have to come in and offer the last few of us share holders $1.50c. Then we'll say, well i was thinking more like $2.50 this year:D.Maybe a lot more next year. Good night happy dreams:).
not totaly useless info seeweed....if you take away freedom,s 20% that sure is a big chunk and no new holder notice......what price to buy A2.....we own no farms...no processing facilities.....no distribution and at this stage not a lot of profit so to buy ATM you have to believe in the A1-A2 theory or want the patents...throw in the price war for milk in the uk and the conundrom continues and on top of this the md says he expects no offer to be forth comming any time soon......

[winner69]

Yes, some blocks of shares have transferred to the ASX. For example, a list of the main NZX-registered shareholders no longer includes Freedom Foods. There has also been a drop recently in the number of shares held in custody by NZ Central Securities Depository (Reserve Bank), some of which would have been moved to ASX, although a few million have been sold down (eg by Milford and NZSF). Before the dual listing, NZCSD held 48% of ATM shares in custody, whereas a few days ago (just before the takeover talk) it held only 37%. With a dual registry it's a lot harder to keep track of share movements now.

More likely those recent early INT trades are northern hemisphere institutions buying some overnight

[NZSilver]

Was hoping for an announcement today before opening, turns out KMD has stolen ATMs limelight. Did someone say that ATM was meeting the consortium yesterday to discuss the T/O (or what ever you would like to call it)?

[janner]

What will this do to the Worlds over supplied milk trade ???

http://rt.com/business/270463-china-russia-milk-farm/

[NT001]

What will this do to the Worlds over supplied milk trade ???

http://rt.com/business/270463-china-russia-milk-farm/

Dairying is an economically cyclical business, and this project will take years to develop fully, so no immediate threat. And 100,000 cows is about one-50th of NZ's current national dairy herd.

[gv1]

Well, if its the Chinese, then I want $5 for my shares. Because I don't have an Auckland house.

:D
72c is very cheap than.....

[see weed]

What will this do to the Worlds over supplied milk trade ???

http://rt.com/business/270463-china-russia-milk-farm/

Will not affect a2 milk sales. Those Chinese cows all look like a1 to me.

[Lola]

http://www.smh.com.au/business/jdcom-founder-richard-liu-taps-a2-milk-treasury-wine-to-rival-alibaba-20150629-gi0p98.html interesting read could be another investor to rival freedom

Yes it is ....but where is Fonterra in all of this? Can hardly be standing idly by and just watching, surely. Their "no comment "a few days ago seems, um, a bit disingenuous.

[see weed]

Bit more useless info....98,909,000 shares sold in last 20 days. 1.1million tomorrow will make 100,000,000 sold. Maybe Deans etc. will not have to make an offer, just buy them on market. Plenty of sellers. When they dry up and stop selling,is when sp may creep up again. Then FF & Deans will have to come in and offer the last few of us share holders $1.50c. Then we'll say, well i was thinking more like $2.50 this year:D.Maybe a lot more next year. Good night happy dreams:).

Well someone just bought that 1 million shares, that now takes it to 100,000,000 in 21 days.

[sb9]

I'm guessing this is a period of lull before next set of whirlwind...

[drcjp]

I really don't think much will happen in next couple of weeks. Today is last day of FY so positions being taken. All eyes on FY15 results in August. Interesting times with Greece and KMD all playing out this week

[NT001]

where is Fonterra in all of this? Can hardly be standing idly by and just watching, surely. Their "no comment "a few days ago seems, um, a bit disingenuous.

Fonterra's options are limited. It's not flush with money at the moment, and for the past several years it has publicly rubbished the science underlying A2 even though its own chief scientist helped uncover the health benefits of A2.

It has always used the "no comment" response regarding a2MC and A2 milk. It really doesn't want to go there. It probably doesn't mind too much as long as A2 is promoted as just a niche product that caters for a small minority who have digestive problems. A2 isn't eroding Fonterra's markets at present, so there's no pressure on it to get involved at this stage.

What it would probably like is for a2MC to be taken over by a consortium that is internally divided and doesn't understand what to do with it, thus slowing down the momentum it has just begun to develop after a pretty rocky first decade.

[Lola]

Fonterra's options are limited. It's not flush with money at the moment, and for the past several years it has publicly rubbished the science underlying A2 even though its own chief scientist helped uncover the health benefits of A2.

It has always used the "no comment" response regarding a2MC and A2 milk. It really doesn't want to go there. It probably doesn't mind too much as long as A2 is promoted as just a niche product that caters for a small minority who have digestive problems. A2 isn't eroding Fonterra's markets at present, so there's no pressure on it to get involved at this stage.

What it would probably like is for a2MC to be taken over by a consortium that is internally divided and doesn't understand what to do with it, thus slowing down the momentum it has just begun to develop after a pretty rocky first decade.

Thanks Mr NT001; sensible observations. Somehow I don't think A2 management will let the grass grow under its feet.( No Pun.) Fonterra is like methuselahs: Serious innovation isn't in its'" to do" list. A2 has shown more of it in 10 years than Fonterra has in 50. JVs to distribute 56 lb bags of powder with local agents are still part of the strategy Id guess. Snooze.

[Tsuba]

JD.com founder Richard Liu taps a2 milk


http://www.smh.com.au/business/jdcom-founder-richard-liu-taps-a2-milk-treasury-wine-to-rival-alibaba-20150629-gi0p98.html (http://www.smh.com.au/business/jdcom-founder-richard-liu-taps-a2-milk-treasury-wine-to-rival-alibaba-20150629-gi0p98.html)

[NZSilver]

Yep would be very keen for JD to take a holding on a2