SML - Synlait Milk Ltd

[Leftfield]

Up 5% today on decent volume, expecting positive outcome on Monday 21st Oct perhaps? I think that's date of supreme court decision from memory, can someone confirm.

I agree re today's SP action and yep that's the date for the hearing that I've noted...

[Beagle]

Not sure you'll get a decision that day though. Its just oral legal representations as to whether a formal appeal to the Supreme court will even be allowed and I would think the Supreme court's decision will be reserved and advised at a later date and even if an appeal is allowed that won't be for quite some time and again will probably be a reserved decision. Market could be getting ahead of itself here.
A negative response either to the right to have a formal appeal or to the appeal itself, (if allowed), in due course could have quite a dramatic impact on the share price.

[Leftfield]

Not sure you'll get a decision that day though. Its just oral legal representations as to whether a formal appeal to the Supreme court will even be allowed and I would think the Supreme court's decision will be reserved and advised at a later date and even if an appeal is allowed that won't be for quite some time and again will probably be a reserved decision. Market could be getting ahead of itself here....

An out of court agreement is possible at anytime.

[Beagle]

An out of court agreement is possible at anytime.

Sure is and has been a possibility for how long now ?

[Leftfield]

Sure is and has been a possibility for how long now ?

OK Beagle you the expert.

[Beagle]

OK Beagle you the expert.

Not the expert at all. Just pointing out the risks and the fact that Synlait have been saying for well over a year now that they are in talks...none of which have been productive so far, hence the request to be allowed to appeal to the Supreme Court.

[RTM]

Not the expert at all. Just pointing out the risks and the fact that Synlait have been saying for well over a year now that they are in talks...none of which have been productive so far, hence the request to be allowed to appeal to the Supreme Court.

I just can’t believe that Synlait don’t have a strong alternative and they are just going through the court stuff to see if they can get a lesser cost option. Can’t believe they would be that irresponsible as to not have this under control. We are just speculating without all the info. Having said that ....I did sell my shares a while ago. Having said that...it’s clearly going to cost them.

[BlackPeter]

I just can’t believe that Synlait don’t have a strong alternative and they are just going through the court stuff to see if they can get a lesser cost option. Can’t believe they would be that irresponsible as to not have this under control. We are just speculating without all the info. Having said that ....I did sell my shares a while ago. Having said that...it’s clearly going to cost them.

Whatever it is - either they or their shareholders are flying blind. If they have a hidden ace, then they might breach their continuous disclosure requirements, and if they haven't then they operate with hope as a a strategy.

Not a good position to be in (not just) for a listed company.

[sb9]

An out of court agreement is possible at anytime.

That's what I'm thinking myself too...

[Beagle]

I just can’t believe that Synlait don’t have a strong alternative and they are just going through the court stuff to see if they can get a lesser cost option. Can’t believe they would be that irresponsible as to not have this under control. We are just speculating without all the info. Having said that ....I did sell my shares a while ago. Having said that...it’s clearly going to cost them.

Fascinating from the sidelines to watch this train journey and possible train wreck and whilst you would think someone is at the controls who knows what they're doing I often wonder..., (what with their all consuming obsession with all things inclusiveness and environmentally politically correct).
The facts we do know are alarming. Fact - They have said they have been talking for over a year now but despite the high court case and all this alleged talking they have made no progress and indeed press reports suggest the other party isn't interested in a settlement.

Fact - Despite not knowing the odds on a successful outcome there are two clear hurdles to overcome in the Supreme court situation. Hurdle 1. Getting them to allow a formal objection, (we don't know the odds of who will be successful with their oral submissions), so lets call that 50/50 odds. Hurdle 2. If hurdle 1 is successfully jumped there is the formal appeal which could go either way, so again lets ascribe a 50/50 chance, (although I think its lower than this because the law in relation to covenants on property rights go's back well over a hundred years and is highly likely to trump any zoning the Council have allowed), but lets stick with 50/50. Statistically the odds on jumping two hurdles in a row both with a 50/50 probability are of course one in four.

What's Synlait's plan for the highly likely eventuality of the Supreme court not granting them any relief ? Will the neighbour's immediately move to seek an injunction to stop Synlait operating their plant and then literally have Synlait at their complete mercy in terms of having to pay whatever they feel like demanding in compensation ? The pathway to Synlait being legally greenmailed for a very large sum of money seems pretty clear to me and looks far more likely than any other outcome.

I think Synlait have been asleep at the wheel and the pending train wreck will make for fascinating viewing, (from the sidelines). Like you, I got off the train a while back having serious concerns anyone knew where it was really going.