SML - Synlait Milk Ltd

[JohnnyTheHorse]

The placement price was fixed at $5.10 in the original announcement, so of course they all went at $5.10.

The good thing is that they all went.

Ah yes right you are. I had assumed it'd be a bookbuild/bidding process with an underwritten minimum price.

[JohnnyTheHorse]

Got back on this horse at $5.40 for another crack. Goldmans have upgraded to Buy with a $7.02 target price.

[Nigel]

Why wouldn't you wait for the SPP at $5.10?

[JohnnyTheHorse]

Why wouldn't you wait for the SPP at $5.10?

Very unlikely to get a full allocation. The capital raise was ~20% of market cap, so assuming everyone takes up their allocation you'd only get ~20% of your original shares.

[Snow Leopard]

Why wouldn't you wait for the SPP at $5.10?

Very unlikely to get a full allocation. The capital raise was ~20% of market cap, so assuming everyone takes up their allocation you'd only get ~20% of your original shares.

Whilst I can see the logic in that I don't see the logic in that!

Apply for what you are guaranteed to get + plus a few more, and buy the remainder on market.
That is my plan.

[Nigel]

Watched the AGM online today. All very positive, and (much to the disappointment of some on here) only a little bit of talk about the environment. Most of the chat was about how they have reduced risk by diversifying the business (by site, customer, category and market), about the opportunity presented by the new multinational customer, and the fact that focus now shifts from investing in building the business to actually making money. They acknowledged that the share price had drifted down from $10 to the current price in the $5s, and I took from the comments that they expect to shift it north again now that the investment phase has finished. Lots of opportunity for future growth.

I left the meeting quite excited about where the company is heading and hoping I get a decent tranche of the shares I applied for in the SPP.

Did anyone else attend?

[limmy]

It's not clear watching the AGM online who the new multinational customer it. Have I missed something ?

[Nigel]

They said that they wouldn't name the client for the client's own privacy. Having worked in the industry, that isn't too uncommon, especially when there's some new innovative products in development. They are working with the new customer on some new products (plant-based products) and I think it's all a bit hush-hush. They name-dropped a number of other existing customers including Nestle and FreislandCampina, so it isn't them. From memory they said it was an Asian customer (certainly that it would open up more opportunities in Asian markets) - could be one of the big Japanese players?

[dreamcatcher]

Watched the AGM online today. All very positive, and (much to the disappointment of some on here) only a little bit of talk about the environment. Most of the chat was about how they have reduced risk by diversifying the business (by site, customer, category and market), about the opportunity presented by the new multinational customer, and the fact that focus now shifts from investing in building the business to actually making money. They acknowledged that the share price had drifted down from $10 to the current price in the $5s, and I took from the comments that they expect to shift it north again now that the investment phase has finished. Lots of opportunity for future growth.

I left the meeting quite excited about where the company is heading and hoping I get a decent tranche of the shares I applied for in the SPP.

Did anyone else attend?

Thanks for the summary which sounds great for the future and wait for new customer update. Also applied for good slice of SPP

[dreamcatcher]

Oversubscribed, appears my good slice of SPP will be slashed......

https://www.nzx.com/announcements/364145