A2 Milk Co has bought an 8.2% stake in Synlait Milk.
A2 Milk Co has bought an 8.2% stake in Synlait Milk at a small premium, building on an existing supply agreement between the milk marketer and dairy processor.
Sydney-headquartered a2 bought 14.6 million shares at $3.275 apiece from Dutch dairy processor Royal FrieslandCampina, a 5.6% premium to Thursday's closing price
of $3.10 and a 3% premium to the one-month volume weighted average price.
The Dutch company, which counts Fonterra Co-operative boss Theo Spierings as alumni, took a stake in Synlait when it went public in 2013, buying shares at $2.20 apiece in the float, but signalled a change of tack in the investment when it didn't acquire further stock in last year's capital-raising.
A2 and Synlait signed a supply agreement in 2012 to support the a2's plans to launch infant formula sales into China, and inked a new deal last August providing for increased scale if market demand warranted it.
The milk marketing firm said the Synlait investment provided certainty for its medium-term plans, with the supply agreement still at the heart of their relationship, and that it had no plans to lift its stake.
