Explain the relationship between the two companies (a2 and Synlait) based on the information provided. A2 and
Question:
Explain the relationship between the two companies (a2 and Synlait) based on the information provided.
A2 and Synlait are key strategic partners
Listed investment at fair value 252,580 in 2020, 286,807 in 2019
The listed investment is in Synlait Milk Limited (Synlait).
No dividends were received from this investment during the year (2019: $nil)
In March 2020 A2 made a further investment in Synlait, acquiring 4,400,000 shares for $21,856,000, increasing its total holding in Synlait to 19.84% (2019: 17.39%). A fair value loss of $56,083,000 (2019: loss $62,390,000) was recognised for the year.
This listed investment is a long-term investment classified as a financial asset measured at fair value through other comprehensive income. The Group does not control or have significant influence over the investee.
Unrealised gains or losses arising from changes in fair value are recognised through other comprehensive income in the Fair Value Revaluation Reserve within equity.
A2 is the 2nd largest shareholder in synlait - 35,574,646 shares, 19.8% of the shares in Synlait
A2 is a substantial product holder in Synlait.
The number of shares owned is as advised by the shareholder in their last Substantial Security Holder Notice
Synlait " the Board and management have the view that we have become too reliant a single customer – The a2 Milk Company."
Expert Answer:
Relationship between the two companies A2 and Synlait The a2 Milk Company a2MC is pleased to announce that its shareholding in Synlait Milk Limited ha... View the full answer
