SML - Synlait Milk Ltd

[sb9]

We've ASM in a week's time on next Wed 27th, it'll be interesting how that culminates on back of today's A2M's meeting.

[Beagle]

I'd bet my last dollar ATM screwed them down even further on their extended supply contract announced today. SML are ATM's whipping boy...

[pierre]

I'd bet my last dollar ATM screwed them down even further on their extended supply contract announced today. SML are ATM's whipping boy...

I think SML is your whipping boy too Beagle

No doubt they've screwed them down - but not too hard - don't forget ATM owns a slice of SML.

[mfd]

I think SML is your whipping boy too Beagle

No doubt they've screwed them down - but not too hard - don't forget ATM owns a slice of SML.

A2's synlait holdings contributed about 16 million dollars to last year's profits of 287 million. I'm not sure that's enough to make it worth them going easy on synlait, although I'm sure they have an interest in paying them enough to ensure their survival.

[bull....]

possibly raising money to pay out someone?

https://www.nzx.com/announcements/344722

[Beagle]

Gearing with senior debt last time I looked was a whopping 57%, possibly quite different now, DYOR. Investors would do well to consider the word "subordinated" and what it means in the context of this company. That won't stop the issue being successful because all a lot of retail investors will see is the Synlait name, (without any understanding of the Pokeno risk) and the interest rate.

Probably wise as a contingency to raise some money now and they can always tap shareholders for more if the custard really hits the fan.

[BlackPeter]

possibly raising money to pay out someone?

https://www.nzx.com/announcements/344722

Interesting idea. They say to repay existing bank debt, but who knows.

Order of magnitude ($150m with option for up to $50 m over-subscriptions) would be roughly half of the maximum damage an unfavorable (for them) court decision could inflict.

Interest rate not yet fixed, but Chris Lee says they expect interest rate to be set at roughly 4%. This would be 1 to 1.5% higher than current blue chips bonds. Quite a substantial risk penalty if he is right ...

[Nasi Goreng]

Gearing with senior debt last time I looked was a whopping 57%, possibly quite different now, DYOR. Investors would do well to consider the word "subordinated" and what it means in the context of this company. That won't stop the issue being successful because all a lot of retail investors will see is the Synlait name, (without any understanding of the Pokeno risk) and the interest rate.

Probably wise as a contingency to raise some money now and they can always tap shareholders for more if the custard really hits the fan.

I was half expecting you to suggest the $150m is a nice backstop for the court cases, it’s the first thing I thought. As a holder I don’t think it’s a bad move although I really can’t see the custard flying as vividly as you can.

[peat]

unsecured AND subordinated ,
nasty.

[Sideshow Bob]

Flew over the plant last week on the approached into Chch.

As well as the font, they had a couple of lovely bright pink paths or roading through the plant.

Sure W69 would have loved it.