although SM1 may ask for compensation, there is no basis to pay...

First 36 Last

Share
Profile

Follow
golddigger741

546 Posts.

84

20/09/23

15:10

Post #: 69938609
Share

Originally posted by werdplaya58: ↑

It sounds as though just the exclusivity clause of the agreement has been affected by the failure to meet DIFOT performance targets, and all other aspects of the agreement are unaffected. In the absence of another manufacturing source, it continues as a de facto exclusive supply arrangement.

I take your point about the contract, I'm no expert but potentially there was also nothing Synalit could have done contractually? As I don't think any company in A2M's shoes would accept an arrangement where the supplier could continue to maintain exclusive rights if they were not meeting required targets.

What they do seem to have in place is a mandatory negotiation period in which the parties can seek to resolve the issue before going to arbitration.

I think what will be negotiated is how much longer Synlait will retain exclusive production rights for English label. A2M may seek a period that allows them to smoothly transition production to MVM. Depending on how much or how little Synlait is genuinely at fault, I guess Synlait may seek to push this period out or financial compensation from A2M to Synlait, but that's just speculation on my part.

Synlait does receive rolling demand forecasts from A2M periodically and can only react to this with a certain amount of notice, which may have put them on the back foot. At least, I suspect that's what they would use to argue that they aren't to blame for the delays and failures to meet their targets.

Expand

although SM1 may ask for compensation, there is no basis to pay it if they did breach the contract. they have no exclusive right to manufacture IF in perpetuity so what is there to compensate them for? did they compensate a2m's lost sales?

A2M Price at posting: $4.29 Sentiment: Buy Disclosure: Held
4 Upvote

0 Great analysis

Reply

Top Stories

HotCopper Trends: Wall of quarterlies dominate; then there's Micro-X & Ionic

IXR

Ionic Rare Earths falls -7% as momentum slips on vague production update

HAR

Haranga jumps +7% on Lincoln acquisition

NUZ

Neurizon inks $1.5M loan against R&D Tax Rebate

ASX Market Close: Index rebounds as investors buoyant | July 30, 2025

First 36 Last

Add to My Watchlist

What is My Watchlist?

A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.

(20min delay)
Last $8.03		Change -0.060(0.74%)		Mkt cap ! $5.813B

Open	High	Low	Value	Volume
$8.00	$8.12	$7.93	$15.91M	1.977M

Buyers (Bids)

No.	Vol.	Price($)
1	1000	$8.03

Sellers (Offers)

Price($)	Vol.	No.
$8.06	14100	2

View Market Depth

No.	Vol.	Price($)
1	26	8.100
1	5	8.030
1	311	8.020
5	2448	8.000
2	1644	7.990

Price($)	Vol.	No.
8.020	2	1
8.030	2176	2
8.070	1846	3
8.090	1499	1
8.100	1325	3

Last trade - 16.10pm 30/07/2025 (20 minute delay)

A2M (ASX) Chart

although SM1 may ask for compensation, there is no basis to pay...

HotCopper Trends: Wall of quarterlies dominate; then there's Micro-X & Ionic

Ionic Rare Earths falls -7% as momentum slips on vague production update

Haranga jumps +7% on Lincoln acquisition

Neurizon inks $1.5M loan against R&D Tax Rebate

ASX Market Close: Index rebounds as investors buoyant | July 30, 2025

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

although SM1 may ask for compensation, there is no basis to pay...

Top Stories

HotCopper Trends: Wall of quarterlies dominate; then there's Micro-X & Ionic

Ionic Rare Earths falls -7% as momentum slips on vague production update

Haranga jumps +7% on Lincoln acquisition

Neurizon inks $1.5M loan against R&D Tax Rebate

ASX Market Close: Index rebounds as investors buoyant | July 30, 2025

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News