SML - Synlait Milk Ltd

[FarmerHamilton]

This may have something to do with the strength in SML today

WCB recommends Saputo bid of $7 per share

• Business Spectator
• October 08, 2013 11:47AM

WARRNAMBOOL Cheese and Butter Factory has recommended a takeover bid from Saputo, Canada's largest dairy processor, after earlier spurning an offer from local rival Bega Cheese.

In a statement to the Australian Securities Exchange, WCB said it had entered into a takeover bid implementation deed with Saputo, which will make an all cash off-market takeover offer of $7 per share for all shares on issue, valuing WCB at $392.7 million.
The offer is subject to conditions including Foreign Investment Review Board approval and a minimum acceptance condition of more than 50 per cent of WCB shares.
The companies have agreed WCB may declare and pay fully-franked special dividends of up to a maximum of $1.31 per WCB share, with a corresponding reduction in the offer price, on Saputo reaching specified relevant interest thresholds in WCB.
This would enable distribution of franking credits that could deliver up to an extra 56 cents per share in value.
The WCB board unanimously recommended the offer and each director and executive intends to accept the offer for all shares they hold, the group said.
WCB has agreed to exclusivity restrictions that stop it from entering discussions with any competing bidder, and must also pay a break fee if the board changes its recommendation.
WCB directors last month unanimously recommended shareholders reject Bega's offer of 1.2 Bega shares and $2 cash for each WCB share, saying the $320 million offer was inadequate.
Saputo believes its offer is highly compelling and said excluding any extra value from franking credits, the all-cash offer price represented a 21 per cent premium to the implied value of Bega's offer, based on Bega's share price on the last trading day before its offer was announced.

Saputo said its offer also gives WCB shareholders the certainty of 100 per cent cash for their shares and fewer conditions than the Bega offer.
The bidding war comes as companies vie to supply Asia's growing appetite for diary.
The suitor said its strategy in the acquisition is to position WCB as the centre of its operations in Australia and its main platform to service demand for dairy in the Asia Pacific region.
Saputo said it can assist WCB's future development and accelerate its growth nationally and internationally, which should lead to a greater demand for milk and benefit WCB's suppliers.

- See more at: http://www.theaustralian.com.au/busi....Chp0akpO.dpuf

[FarmerHamilton]

344 +10

No US Government shut-down effect here !!

[K1W1G0LD]

I can guarantee you that if the debt ceiling is not resolved then nothing will like pretty the day after, even SML.

However, we all know it will get resolved, so keep on holding that liquid white gold

Now YOU'RE starting to sound like Snoopy, Moose.

[K1W1G0LD]

I can guarantee you that if the debt ceiling is not resolved then nothing will like pretty the day after, even SML.

However, we all know it will get resolved, so keep on holding that liquid white gold

Now YOU'RE starting to sound like Snoopy, Moose.

[RTM]

360 ¢ (NZD) 15 4.3%

10/10 10:38 NZT

What's going on Farmer Hamilton ?
Wished I had more !

Cheers
RTM

[GRIFFIN]

White gold is only part of it wait till Lactoferrin kicks in.

[FarmerHamilton]

Man, this sure was a winner! Nothing can stop this puppy, NZ sure loves it's white gold.

Do you have a ridiculous, sell-at-an-extreme-price-no-matter-what target FH?

I can't sell any until Sept'14 due to the escrow clause in the IPO so I will just sit and watch until then. I guess the very fact that so many shares can't be sold by all the larger shareholders and a large chunk of the IPO went to long term institutional holders such as ACC or the SuperFund, and index trackers who need to actually buy more as the price keeps rising means the demand/supply equation is pretty tight!!

I would love to see $4+ by this time next year.

Market Cap us now over $530m !!!

[FarmerHamilton]

Best guess-timate for Synlait Milk of payout for 13/14 season is now .... $9.00 !!!!!

Info gleaned from Synlait Farms takeover documents received today. Holy Cow the NZ economy could go ballistic and RB will be raising rates sooner rather than later.

[K1W1G0LD]

Best guess-timate for Synlait Milk of payout for 13/14 season is now .... $9.00 !!!!!

Info gleaned from Synlait Farms takeover documents received today. Holy Cow the NZ economy could go ballistic and RB will be raising rates sooner rather than later.

FH how would such a high payout to farmers affect SML own profitability and forecast.

[FarmerHamilton]

FH how would such a high payout to farmers affect SML own profitability and forecast.

Hard to say , you would think it would make it tough to hit the budget but prices for the end product such as AMP,SMP,WMP are obviouslt incredibly strong so as long as margins are maintained it should be win/win for everyone. It will certainlt provide incentive for their suppliers to glean every last drop of production from the herd over the rest of the season ... I imagine the price of feed/supplements is climbing rapidly at present as farmers look to building stocks for the late summer / autumn period. A decent summer with good rainfall and the numbers going into the NZ economy could be eye-watering !!