China Mengniu Dairy 2319

China Mengniu Dairy 2319

Postby winston » Fri Aug 01, 2008 8:49 pm

Mengnui share sale

The major shareholder of China Mengniu Dairy (2319) is seeking to reap as much as HK$1.29 billion by selling shares in the company, according to a term sheet obtained by The Standard.

Yinniu Milk Industry is placing 57 million existing shares of Mengniu at between HK$22.15 and HK$22.60 per share, representing a discount of 4.2 percent to 6.1 percent to today's close of HK$23.06.

STAFF REPORTER
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Re: China Mengniu Dairy 2319

Postby winston » Wed Sep 17, 2008 12:30 pm

No put warrants :(

========================

Mengniu to recall tainted products, halt production

China Mengniu Diary (2319), the nation's biggest producer of liquid milk, will recall all products that have failed government tests for a chemical linked to infant kidney stones.

Mengniu will suspend production for the related products and offer compensation to affected consumers, the company said.

The announcement said the recall covers three batches of formula made in January but gave no details on how much product will be affected.

It's testing all of its products and will know the results in a few days, it said. The company apologizes for the tainted products.

AGENCIES
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Re: China Mengniu Dairy 2319

Postby winston » Tue Sep 23, 2008 8:53 am

From Dr. Check:-

Mengniu Dairy (2319), China's biggest milk producer, will survive this disaster. Mengniu shares are now suspended and are expected to face heavy selling when trading resumes.

Morgan Stanley reduced its target to HK$13.50 but expects the company to strengthen. Mengniu's record high was HK$36.75 in October last year.

The shares are worth accumulating gradually as a long-term holding.

( Winston's comments:- It is very likely that people will stop buying dairy products fpor a while. )
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Re: China Mengniu Dairy 2319

Postby winston » Tue Sep 23, 2008 9:01 am

China Mengniu Dairy Boosts Milk Tests, Faces `Critical Moment'
By Kelvin Wong

Sept. 23 (Bloomberg) -- China Mengniu Dairy Co., the country's largest producer of liquid milk, said it's boosting quality standards and facing a ``critical moment'' after tainted Chinese-produced milk sickened almost 53,000 children.

Mengniu has carried out tests on ``each and every lot'' of raw milk sourced since the scandal broke and on final products to check for the chemical melamine, it said in a Hong Kong stock exchange statement late yesterday. The company's shares will resume trading today, it added.

Tainted milk has led to the deaths of four infants, triggering the replacement of China's chief quality supervisor and causing countries from Asia to Africa to curb sales of Chinese dairy products. Premier Wen Jiabao ordered an overhaul of the industry after goods made by 22 companies including Mengniu were found to contain melamine.

``The board wishes to sincerely apologize for the incident and any inconvenience caused to the public,'' Mengniu said in the statement. ``The board and the management believe that this critical moment for both the industry and the group has to be managed in a proactive manner.''

The company also pledged to pay compensation double the statutory amount due under Chinese law to anyone diagnosed as becoming ill as a result of consuming tainted goods within the next five years.

Product Recall

Mengniu has recalled the products linked to melamine, all of which were only for distribution and sale within China, according to the statement. The tainted goods represent ``a small percentage'' of Mengniu's range, it added.

Starbucks Corp. said on Sept. 19 that its Chinese outlets would use soy milk instead of products from Mengniu because of the scandal.

To improve standards, the dairy company is sending managers out across the country to help local distributors boost inspections. Mengniu will also only work with suppliers that have consistently passed quality tests, it said. The Hong Kong- based company is also conducting a full review of its production processes and drawing up plans to improve communications.

Mengniu last traded in Hong Kong on Sept. 17 at HK$20. The stock has lost 30 percent this year.

Li Changjiang resigned after seven years as chief of the General Administration of Quality Supervision, Inspection and Quarantine, the official Xinhua News Agency said yesterday. Wang Yong, former secretary-general of the State Council, China's cabinet, replaced him, the news agency said.

Melamine, used to make plastics and tan leather, can disguise the fact that milk has been diluted by increasing the apparent protein content. Companies in the dairy industry didn't check for the chemical before the scandal broke, Mengniu said.

Melamine-tainted milk has been linked to the hospitalization of 12,892 infants and the sickening of another 39,965 babies as of yesterday.
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Re: China Mengniu Dairy 2319

Postby winston » Tue Sep 23, 2008 10:13 am

STOCK ALERT China Mengniu Dairy tumbles 65 pct after resuming trade in Hong Kong

HONG KONG (XFN-ASIA) - China Mengniu Dairy shares fell about 65 pct after resuming trade following its suspension from September 17 in the wake of the tainted milk scandal.

The stock was down 12.90 hkd or 64.5 pct at 7.1, off a low of 6.85.

China's General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) conducted tests last week and found melamine in some Mengniu milk powder and liquid milk products.

Several brokerages downgraded Mengniu and other Chinese dairy firms following the contamination scandal, which has prompted product recalls and import bans of Chinese products in several countries.

JP Morgan slashed its target price on Mengniu Dairy to 3.80 hkd from 18.0, as it forecast net losses for the second half of the year through 2010.

UOB Kay Hian downgraded Mengniu to "sell" from "hold" and cut its target to 12.95 hkd from 25.15.

Mengniu Dairy said in a statement that it will restore its competitiveness through various measures including internal tests on products, sourcing raw milk only from quality suppliers and a thorough review of its production processes.
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Re: China Mengniu Dairy 2319

Postby -dol- » Tue Sep 23, 2008 12:24 pm

This "cash cow" is a goner for a while to come.

It will be an uphill task to convince the institutional investors to consider it again. Therefore, the target prices are academic.

Moo-hoo...hoo...
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Disclaimer: This is not investment advice! Please do your own research and due diligence.
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Re: China Mengniu Dairy 2319

Postby winston » Wed Oct 01, 2008 7:55 pm

Not vested and will not be for a long time..

Mengniu didn't know about milk tainting until Sept 11


China Mengniu Dairy (2319) said it found out about melamine-tainted milk when the government issued a statement on September 11, more than a month after stockholders had sold shares in the company.

"The placing of the company's shares by shareholders was completed as early as on 1 August 2008,'' Mengniu said.

"Mengniu was not aware of any non- disclosure of price-sensitive information at that time.''

The group only discovered some of its own products were tainted by melamine after test results September 16, it said.

Tainted milk powder, first found in Sanlu Group's products, killed at least four babies and left 53,000 ill, according to government officials.

BLOOMBERG
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Re: China Mengniu Dairy 2319

Postby -dol- » Thu Oct 02, 2008 7:03 am

The brand and trust has been shot to pieces for now.

This is not a JNJ.
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Re: China Mengniu Dairy 2319

Postby winston » Tue Dec 02, 2008 8:15 am

BTW, I'm still avoiding the Chinese Dairy Products. From Dr. Check:-

Mengniu Dairy (2319) was among yesterday's gainers.

The mainland milk manufacturer came under heavy selling pressure when it resumed trading in September in the wake of the tainted-milk scandal.

It dropped to as low as HK$6 in October. It rose 14 percent yesterday to HK$8.70.

Mengniu's sales are now around 90 percent of their levels before the melamine tragedy.

Some investors are afraid Mengniu will lose its market leadership position in China to foreign brands, but Dr Check doesn't think so.

My advice is to buy Mengniu bit by bit whenever it dips.
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Re: China Mengniu Dairy 2319

Postby winston » Wed Dec 24, 2008 10:07 am

China Mengniu Dairy sees 900 mln yuan loss this yr; shares slump 6 pct UPDATE

HONG KONG (XFN-ASIA) - China Mengniu Dairy Co Ltd said it expects to incur a loss of 900 mln yuan this year as sales were affected by the melamine contamination scandal in China.

It said the group write off certain inventories and incurred costs for disposal of raw milk following the contamination incident.

Mengniu said the anticipated 2008 loss is based on preliminary figures.

A milk-products contamination scandal broke out in China in mid-September, involving several dairy firms in the country.

Mengniu shares opened down 6 pct.
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