Ann: Response to ASX Price Query, page-3

Done - excerpt posted below.

Spilt milk

If at first you don’t succeed, find another company shell and give it a crack. That certainly seems to be the theory of former A2 Milk executive Peter Nathan, who is getting the band back together over at ASX-listed tiddler Australian Dairy Nutritionals.

Credited with much of A2’s success in expanding its market into China in the boom years for infant formula, after getting the hang of the country’s notorious daigou marketing channels ahead of his rivals, Nathan left something of a sour taste with retail shareholders on his departure.

He quit the New Zealand company in 2021 after successive downgrades, and after flogging a substantial number of shares at the top of the market.Nathan was last seen on the losing side of a board spill at Bubs amid a bitter falling out between ousted chief executive Kristy Carr and chair Katrina Rathie.

Carr copped the blame for a failed China-focused marketing strategy and tried to roll the board, picking Nathan to lead Bubs in her stead. That effort fell well short of the shareholder votes needed, and the rebels slunk off into the distance.

But failure at Bubs hasn’t dimmed Nathan’s ambition to replicate the success of A2, where he served as the milk-seller’s Asia-Pacific boss.

After taking over as executive chairman at ADN in June, where former A2 boss Geoff Babidge is also a shareholder, Nathan’s first move was to install his one-time marketing director at A2, Mahi Sundaranathan, as chief executive.And who joined the ADN board in October?

China’s daigou king Andy Zhang, who claims credit for the success of A2 products in the country before the pandemic, importing cargo loads of baby formula for sale to Chinese consumers. Zhang, of course, also played a major role in the Bubs stoush. He stopped buying A2 baby formula when Nathan left the company, shifting his attention to Bubs. But that relationship also soured when Carr was ousted, and the Bubs blamed his failure to move enough product on the big losses Bubs was racking up – which also wound up in the courts.

Put it all together, though, and the band is very much back on the road at ADN.

Only time will tell whether the strategy is fit for a post-Covid era.

But it’s clear that not all of ADN’s shareholders are happy to be back on the daigou train. Nathan’s first AGM as chairman this week saw a first strike against ADN’s pay report, an 18 per cent vote against his election as a director, and a 20 per cent vote against the issue of options to the chairman. NE