Synlait falls despite regulators dismissing shareholder complaint
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The news: Synlait saw its shares slide on the ASX despite regulators NZ RegCo and the Takeovers Panel dismissing a shareholder complaint regarding the New Zealand dairy producer's recapitalisation plans.
The numbers: Synlait shares fell 4.1% to $0.35 by 3pm AEST.
The context: NZ RegCo and the Takeovers Panel both confirmed that no further action would be taken in relation to a complaint made by a Synlait shareholder ahead of the company's special shareholders' meeting on 18 September.
On 20 August, Synlait proposed to undertake various actions in order to recapitalise itself. These included a placement of new shares to Bright Dairy for NZD0.60 per share, to raise around NZD185 million ($170.86) and increase Bright Dairy's shareholding in Synlait from 39.01% to 65.25%.
They also included a placement of new shares to The a2 Milk Company for NZD0.43 per share, to raise around NZD32.8 million and maintaining a2's existing interest in Synlait of 19.83%.
Synlait shareholder John Penno complained to NZ RegCo and the Takeovers Panel that Bright Dairy should be disqualified from voting in favour of the a2 placement, and that a2 should be disqualified from voting in favour of the Bright Dairy placement.
The complaint claimed that as the placements were a "related series of transactions", they should form one overall material transaction.
It also noted that both Bright Dairy and a2 are beneficiaries to each other's respective resolutions, and should therefore be prevented from voting in favour of the other's resolution.
The sources: ASX announcement, ASX announcement, ASX announcement
