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Macquarie Sees Upside To Synlait Milk After a2 Investment -- Market Talk

5 Mar 2017 10:13 pm

2213 GMT [Dow Jones] Shares of New Zealand-based Synlait Milk (SML.NZ), a supplier for infant-formula maker a2 Milk (ATM.NZ), should benefit after a2 purchased a roughly 8% stake in Synlait. The new position "may provide a floor in the share price near term," analysts at Macquarie say, adding the stock is "looking more attractive on balance of risks and rewards." Macquarie says Chinese infant-formula regulations could move toward requiring a "higher level of ownership over supply chain," which could prompt a2 to increase its Synlait position in the future. Synlait shares jumped 4.5% on Friday to NZ$3.24 after the deal was announced. (mike.cherney@wsj.com; @Mike_Cherney)

(END) Dow Jones Newswires

March 05, 2017 17:13 ET (22:13 GMT)

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