Chinese-controlled NZ dairy firm mulls listing

WELLINGTON - Chinese-controlled New Zealand dairy processing company Synlait Milk Ltd announced Tuesday that it is considering listing on the New Zealand stock exchange.

However, Synlait Milk marketing and communications manager Michael Wan declined to comment on reports that Shanghai-based Bright Dairy and Food would be diluting its 51-percent stake and ceding control of the firm.

A statement from Synlait Milk advised it was considering an initial public offering and listing on the NZX main board, but gave no schedule for the process.

Synlait Ltd., which owns the other 49 percent of the company, had advised Synlait Milk that it intended to distribute to its shareholders, on a pro-rata basis, the shares it held in Synlait Milk.

As part of the proposed IPO, Synlait Milk intended to offer existing Synlait Ltd shareholders the opportunity to sell some or all of their shares in Synlait Milk.

"Bright Dairy is expected to retain its full investment in Synlait Milk," said the statement.

New Zealand media reported Tuesday that Bright Dairy was " expected" to shrink its 51-percent shareholding "into the 40s," but Wan told Xinhua, "We don't have any further comment to make other than we was issued in the statement."

The proceeds of any offer would be used to support various growth initiatives, including the construction of a new packaging plant, and to facilitate Synlait Milk refinancing its debt position to support the initiatives, said the statement.

Earlier this month, Synlait Milk announced it was to become the world's second manufacturer of an ultra-fine form of the lucrative milk protein lactoferrin to meet booming demand from China with an investment of Nz$15 million($12.42 million) to upgrade its special milk drier at Dunsandel, in the South Island.

Shanghai-based Bright Dairy purchased its majority stake in the Synlait Milk for NZ$82 million in 2010.