Royal FrieslandCampina lifts stake in Synlait Milk to 9.999% buying shares at $3.85 apiece
Royal FrieslandCampina has lifted its stake in Synlait Milk [NZX: SML] to 9.999 percent from 7.5 percent, adding to an investment that has gained 41 percent since its NZX debut last July.
The Netherlands-based cooperative bought about 3.66 million shares at $3.85 each yesterday, according to a statement to the NZX. The shares last traded at $3.87, having sold in Synlait's initial public offering last year at $2.20 apiece.
The purchase puts the Dutch company, where the current Fonterra chief executive Theo Spierings was a senior executive until 2009, ahead of Japan's Mitsui & Co, with an 8.4 percent holding, as the second-biggest shareholder in the Canterbury-based dairy processor. China's Bright Dairy Food owns 39 percent, having been diluted during last year's IPO.
"Our working relationship with FrieslandCampina continues to develop," chairman Graeme Milne said in a statement. "They have become both a valued customer and key strategic partner, alongside our other first tier multinational customers, and we view this announcement as a positive endorsement of the growth and performance of Synlait Milk."
In January, Synlait lifted its forecast milk price for the 2014 season to a range of $8.30 to $8.40 per kilogram of milk solids from $8. It also said net profit would be between $30 million and $35 million in the year ending July 31, up from the $19.67 million forecast in the company's prospectus.
Chairman Milne said at the time that the company is benefiting from growth from its value-add products and a favourable product mix. Dairy products have helped drive New Zealand's terms of trade to a 40-year high and made China the nation's biggest export market.