"Analysts from Citi said the acquisition could grant a2 an “increased ability for a2 to comply with evolving Chinese regulations longer term,” an important ability as the analysts consider increasing geopolitical tensions between Australia and China as one of the company’s largest risk factors. However, the analysts said that due to growing Chinese consumer preference for locally-owned dairy brands - a reversal of the current trend - a more strategic move would have been to establish a joint venture in China with a local partner."
Just a few issues with this:
- Its a NEW ZEALAND COMPANY - I had no idea Chinese consumers had turned their back on overseas IF, surprised based on current trend - The value differentiator for a2 is that the IF is produced in New Zealand, not CHINA!!!!
Lets let Bubs do that. You know, sometimes I think that Citi think they own a2, but also do very little homework.
A2M Price at posting:
$18.63 Sentiment: Buy Disclosure: Held
(20min delay)