SML - Synlait Milk Ltd

[billkiapi]

this sums it up really https://www.nbr.co.nz/investment/pen...ays-a2-letter/

[silverblizzard888]

In some sense I agree with Penno that those who are too close to the deal need to abstain from the vote or else its not really a fair vote, let the minority shareholder who aren't involved have the say on this after all it does alter the whole foundation of the company ownership structure. Just as Bright couldn't vote in the Bright loan, maybe same rules should apply here.

[blackcap]

In some sense I agree with Penno that those who are too close to the deal need to abstain from the vote or else its not really a fair vote, let the minority shareholder who aren't involved have the say on this after all it does alter the whole foundation of the company ownership structure. Just as Bright couldn't vote in the Bright loan, maybe same rules should apply here.

That's fine, put yourself in the position of the Chair. Let minorities vote for Christmas like turkeys and have the company liquidated?

At the end of the day, the deal that has been cobbled together, although not what minority shareholders may have wished for, is putting more money in their pockets. They should not be grumbling. Control ironically was given away quite a while ago, by providing Bright with the 50% board control. Who did that?

[Poet]

That's fine, put yourself in the position of the Chair. Let minorities vote for Christmas like turkeys and have the company liquidated?

At the end of the day, the deal that has been cobbled together, although not what minority shareholders may have wished for, is putting more money in their pockets. They should not be grumbling. Control ironically was given away quite a while ago, by providing Bright with the 50% board control. Who did that?

IMO, absolutely the minority shareholders should vote to put the company into liquidation. That way we will find out exactly how valuable the stainless steel is and who is willing to pay how much for it. The current arrangements aren't leading anywhere good for the minorities.

although if push came to shove, I don't think the two major shareholders would let that happen, they will have a plan B.

[Bikeguy]

How does it help us if SML is liquidated? By the time you pay all the loans and debts (500m +) there would not be that much left split between all the current shareholders surely?

[Poet]

How does it help us if SML is liquidated? By the time you pay all the loans and debts (500m +) there would not be that much left split between all the current shareholders surely?

I don't think it would come to that if the minorities forced their hands.
Blazing Saddles - Nobody move or ... (youtube.com)

[blackcap]

How does it help us if SML is liquidated? By the time you pay all the loans and debts (500m +) there would not be that much left split between all the current shareholders surely?

Exactly, the market was pricing the bonds on the assumption that liquidation value was possibly enough to pay back the debt, but possibly not either. Either way, shareholders may have been left with little or nothing.

[Newman]

Wow- founder Peno, ousted from the board and sued by some related company, now has the gall to complain about the recap process

Every shareholder, except for Dr Peno, could complain about the management of Synlait. He was largely responsible for the current situation of Synlait.

[moimoi]

Liquidate it and watch the 2 largest shareholders crap themselves and bid to recover their sunk cost position / or licence position in the face of offshore and / or local competition who comprehend that you couldn't construct Pokeno or Dunsandel now for anywhere near what SML paid to build them.

Every shareholder bar the top 2 are being stiffed under a promoted narrative that the company is a basket case without the support of those two..one of whom, imo, has knowingly and actively embarked on a process to destroy SML's value.

The evidence for this statement is find any NZX market announcement in the last 30 years where the 2nd largest shareholder has advised 3 days out from a important vote affecting a companies future that they were effectively "undecided".

F off..never ever been done before in the entire history of the NZX other than in this instance.

Over the past 30 years of the NZX there are countless examples of where bidders (usually offshore) have scooped up and de-listed "undervalued" NZ companies. Too many to mention.

Rakon, as an example, not long ago was trading @ 60 cents a share when a very educated, off shore buyer, operating in a similar market segment, lobbed an ultimately unsuccessful bid of $1.70.

NZX often times isn't necessarily a good valuation measurement stick.

IMO

GLTA.