Currently, the company is 49% owned by Synlait Limited with the majority stake in the hands of Shanghai-based Bright Dairy.
“The terms of any offer will be set out by Synlait Milk in a combined investment statement and prospectus registered with the Registrar of Financial Service Providers,” the company revealed in a statement, which gave no indication of a schedule for the move.
“It is intended that the proceeds of any offer will be used to support various growth initiatives including the construction of a new packaging plant, and to facilitate Synlait Milk refinancing its debt position to support these growth initiatives.”
Although the statement pointed out that Bright Dairy is “expected” to retain its full investment in Synlait, New Zealand media were quick to suggest that this was unlikely, with some sources speculating a dilution of up to 10 percentage points.
Formula exports
The announcement comes on the back of recent news that Synlait will this month join forces with Australian dairy producer A2 Milk to begin dispatching consignments of a2 Platinum infant formula to China, from where the clamour for baby powder has spread to the world’s front pages.
The two companies have been working together over the last 18 months on the production of a2 Platinum and other a2 ingredients.
a2 Platinum contains only the A2 version of the beta casein protein, which Synlait claims is more comparable to the protein mothers naturally produce than other version of the protein in standard milk.
Synlait nutritionals general manager Tony McKenna was quick to establish the brands safety qualities in the face of concern about milk formula in China.
“Synlait is unique in the way our supply base is structured to deliver the right type of milk to meet specialised demand. Our plant is also unique in that we can keep specialised milks separate and process each run to meet the exacting specifications for high-value end-products,” he said.
Based on company projections, a2 milk from certified herds will grow to become 8% of the company’s supply.