A2 Milk Co changes requirements for NZ directors ahead of ASX listing

Shareholders of The A2 Milk Company [NZX: ATM], the milk marketing company, have approved a new constitution which allows a reduction in the minimum number of New Zealand-resident directors ahead of a planned dual listing on the ASX this quarter.

Approval from at least 75 percent of shareholders was required to pass the resolution at a special meeting in Auckland today that took just five minutes from beginning to end.

The Auckland-based company is now only required to have two rather than three directors who are New Zealand residents which brings it into line with the NZX's main listing rules. Shareholders last November agreed to increase the maximum number of directors from seven to eight, though chief executive Geoff Babidge said there was no immediate desire to do so.

"It's considered that the current board size (seven) is appropriate but eight provides flexibility to do so at some point in time," he said.

The company doesn't plan to raise any new capital in the float on the ASX and will retain its New Zealand incorporation and NZX listing. The exact date for listing on the ASX will be announced with the release of its half-year results in three weeks.

A2 Milk is one of the fastest-growing dairy brands in Australia with year-on-year brand growth of 38 percent for the four months ending October 2014. Babidge was unable to talk about the company's more recent progress ahead of the release of its results because of sharemarket continuous disclosure rules.

Sales of its branded infant formula into China have just resumed after regulatory changes during 2014 temporarily suspended supply, meaning first-year sales were lower than expected. Babidge said A2 Milk has shifted distribution inhouse in China in order to build sales more quickly.

"We're now putting in place new distribution arrangements in light of that," he said.

The company also plans a launch into the west coast of the US later this year through a wholly-owned US subsidiary.

The shares were unchanged at 57 cents, and have slipped 1.7 percent this year.

(BusinessDesk)