NZ market edges up while shares in Synlait Milk drop almost 10%
The S&P/NZX 50 Index rose 49.3 points, or 0.4%, to 11,397.00. Turnover was $70.7 million. There were 57 gainers and 79 decliners on the main board.
A2 Milk told the market on Monday morning it had notified Synlait on Friday after trading closed on Friday that Synlait's “full and on time performance” fell below the level required for Synlait to maintain its exclusive rights.
Synlait shares were put into a trading halt this morning, and the halt wasn’t lifted until after 3pm. Synlait said it disputes that A2 Milk has the right to cancel the exclusivity arrangements.
The dispute resolution process involves a 20-business day period of good faith negotiation between Synlait and the a2 Milk Company, followed by arbitration if not resolved. The milk processor also confirmed its full-year guidance ahead of the result due to be announced on Sept 25. Its net profit guidance range is a net loss of $5m to a net profit of $5m.
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