A2 Milk, Fonterra Deal A Win With Investors

(Dow Jones) -- A2 Milk Company's newly-minted strategic partnership with the world's largest dairy exporter Fonterra Co-Operative Limited has seen A2's share price, which had already roughly quadrupled last year, rise 16% in early trade on Wednesday to an all-time high of NZ$10.80. A2 has experienced very strong growth in market share, and one of the few issues analysts have seen with the stock is whether it could continue to grow at such a strong level without boosting its supply of milk. Under the deal, Fonterra will manufacture A1 protein-free products for certain priority markets in Southeast Asia and the Middle East exclusively for the A2 Milk Company, as well as giving Fonterra an exclusive licence for the production, distribution, sale and marketing of a2 Milk-branded fresh milk in New Zealand.