SML - Synlait Milk Ltd

[dreamcatcher]

And it only cost $2.3m in 1993 dollars for a 120m move

Fascinating watching and wished I could have stayed longer but think it took 3 days? to complete move as very slow progress.

[Beagle]

I will not buy any SML. Their management has proven they are incompetent in a high stakes game and very poor at keeping the market informed. Its about time they stopped thinking this guy is some local market gardener (with all due respect to producers of our yummy vegetables) they can just steamroll. Good luck to him I say Minmoke

SML Gross Incompetence and Gross Recklessness both in terms of the way they're conducting themselves at Pokeno and in communication with shareholders.
I agree, with the current board and CEO...unless the shares are belted deep down into a very dark hole where they belong, this company is uninvest-able for anyone who understands commercial risk.

[Slam dunk]

Does anyone have a view on how this (if at all) affects ATM? Sorry if covered previously.

[minimoke]

..........

[BlackPeter]

Does anyone have a view on how this (if at all) affects ATM? Sorry if covered previously.

Well, for starters they do own SML shares and ways overpaid for them - i.e. there is already a capital loss which will grow. What might be however worse are any potential production delays due to SML not being able to use their new nearly finished factory. If SML has problems to produce enough A2 infant formula, than ATM obviously can't sell them - i.e. I would expect not just SML's growth but (to a lesser degree - they do have a more diverse portfolio) ATM's growth to stall.

Not sure about delivery commitments - if there are contracts than there might be penalties to pay, but I think this is a lesser risk.

Obviously - if SML can buy themselves out of this mess (which I don't know), than it will be just the respective capital loss ... SML (and ATM as one of the cornerstone shareholders) will suffer from.

[minimoke]

..........

[BlackPeter]

Does this math work out? Worse case, say a $300,000,000 SML payout to make problem go away.

ATM's 17% portion of this would be $51,000,000

Per 735,000,000 ATM shares thats $0.07 an ATM share

Probably requires a rational market, the other side willing to take the $300 million (i.e. your worst case scenario is actually worst case) and no further time delays ...

As well - there might be cost for SML to finance the $300m.

But yes, in general I think it could work that way if the starting assumption is correct ...

If it is not, than any delays would obviously make it worse for SML and ATM. Time is not their friend.

[Beagle]

SML do not have $300m to throw at this problem, assuming it is that much and frankly what the amount is, is anyone's guess. Their balance sheet is already pretty stretched to fund the growth they were looking to deliver. ATM to come to the rescue with a loan to bail them out of the Doggy Doo ?

[kiwi_crusader]

Three new pink milk tankers will be arriving at Pokeno tonight!

[couta1]

Three new pink milk tankers will be arriving at Pokeno tonight!

Along with three flying pinkys spreading helicopter money.