This move by Synlait comes amidst a backdrop of strategic realignments and asset sales. A strategic review found that Synlait’s Pokeno factory was not financially viable for processing raw milk due to operational inefficiencies from switching between dairy and non-dairy products. As a result, the company opted to focus solely on non-dairy nutrition products at the site. The potential sale to Abbott follows a period of financial distress for Synlait, which was bailed out by its major shareholder, Bright Dairy.

Meanwhile, Synlait’s strategic partner and key customer, a2 Milk Company, is taking its own steps to gain greater control over its supply chain. In a major transaction, a2 Milk has purchased a nutritional manufacturing facility, also in Pokeno, from its rival, China’s Mengniu Dairy, for $NZ282 million. This acquisition is a direct move to reduce its reliance on Synlait, as a2 Milk has also informed the market it plans to remove the exclusivity rights Synlait holds for producing its infant formula.

These high-profile deals are unfolding against a backdrop of impressive financial performance from a2 Milk. As a key piece of data journalism, the article notes the company’s group revenue increased by 13.5% to $1.9 billion for the year to June, with net profit rising by 21.1% to $202.9 million. This growth was primarily driven by strong demand from key markets in the U.S., China, and other parts of Asia, fueling the company’s expansion into new markets and categories.