A2 Milk gets key China approval, plans $300m dividend

Author: Jamie Gray,
Publish Date: Mon, 22 Jun 2026, 12:38pm

A2 Milk has got the nod from China to make formula at the former Yashili plant at Pōkeno. Photp / NZME

Infant formula company a2 Milk has received highly coveted regulatory approval from China to make infant formula at Pōkeno.

The company also said it planned to proceed with an earlier-announced $300 million special dividend.

A2 Milk bought the Pōkeno plant from China’s Yashili late last year.

The company said it had received approval from the State Administration for Market Regulation to transition the two China label infant formula product registrations acquired in connection with the a2 Pōkeno facility to a2-branded products.

“This represents the final step pursuant to the terms of a2 Milk’s acquisition of the a2 Pōkeno facility for the relevant registrations to be utilised under the a2 brand,” the company said.

A2 Milk’s shares rallied by 89c or 11% to $9.00 on the news.

The company expects to launch the new products later this calendar year, with no change to the timing or estimated financial benefits provided to the market at the time of announcing the acquisition.

Managing director and chief executive David Bortolussi said the approval marked a significant milestone in the company’s China growth strategy and its supply chain transformation.

“It supports long-term growth in our core infant formula business through market access and innovation, accelerates the development of advanced nutritional manufacturing capability, and captures attractive financial returns through incremental brand contribution and vertical margin capture,” he said.

“As indicated at the time of the a2 Pōkeno acquisition and following receipt of the required regulatory approvals in connection with the company’s China label registrations, it is expected that the board will convene soon with the intent to declare a $300m special dividend that will be fully franked and unimputed.”

From the outset, Synlait Milk has been a2 Milk’s sole supplier of formula from its plant in Dunsandel, in Canterbury.

Synlait, part-owned by a2 Milk, said early this month that from January 1 to April 30 it had incurred a net loss of $12m.

The financial performance had “faced a number of headwinds” outside of its control.

The majority of the negative financial impact relates to the month of January 2026.

In April, a2 Milk said there had been “a significant backlog” of unfilled purchase orders from Synlait with less capacity to catch up following the sale of its North Island assets.

Synlait’s main processing plant is in Dunsandel, where it makes and has licences for a2 Milk product bound for China.

The company, which went through a major recapitalisation in 2024, is primarily owned by China’s Bright Dairy (65.25%) and 19.8% by a2 Milk.