Keytone Dairy completes fund raising for ASX IPO

SYDNEYand CHRISTCHURCH,New Zealand,July 12,2018 -- Keytone Dairy Corporation Ltd ("Keytone Dairy"),has completed the fund raising for its proposed listing on the Australian Securities Exchange ("ASX") via an Initial Public Offering ("IPO"). Demand for shares in KTD significantly exceeded the maximum fund raising of A$12 million (up to A$15 million with oversubscriptions) and as a result scale backs on the number of applications received have been applied.

Selected Examples of Keytone Dairy’s proprietary product range.

Keytone Dairy conducted a targeted marketing campaign in Australia,New Zealand and Asia,and has attracted a number of institutional investors to its register. These include institutions already familiar with the powdered dairy market,as well as institutions with no prior investments in the sector that were attracted to the powdered dairy sector dynamics,as well as the growth potential of Keytone Dairy. Peloton Capital acted as lead broker to the IPO.

Use of funds

Upon listing,Keytone Dairy will have a market capitalisation of A$30 million (based on the IPO issue price of $0.20 per share). Funds from the IPO will be used primarily to:

Expand Keytone Dairy's manufacturing base from its one existing facility (thus substantially expanding its production capacity),

Expand Keytone Dairy's product range,

Expand Keytone Dairy's existing distribution network,and

Develop distribution in additional geographic markets.

Comments

Bernard Kavanagh,Keytone Dairy's Non-Executive Chairman and dairy industry veteran commented: "We are extremely pleased with the response we have received to the Keytone Dairy offer from both institutional and retail investors in Australia and offshore. This is a very exciting time for Keytone Dairy and we warmly welcome all our new shareholders to the register."

James Gong,Managing Director and Chief Executive Officer,said: "We believe that the ASX listing will accelerate Keytone Dairy's growth. Keytone Dairy has already purchased land for two new manufacturing facilities it plans to build,in addition to its purpose built existing Christchurch facility. Once completed,these facilities will enable Keytone Dairy to both increase its capacity and expand into a number of new products,to meet customer demand. Importantly,the new facilities will enable the Company to meet demand from high-volume customers in China and other Asian countries."

Keytone Dairy background

As part of the IPO,Keytone Dairy will acquire Keytone Enterprises (NZ) Company Limited ("Keytone NZ") which is a profitable New Zealand-based manufacturer,packer and exporter of dairy and nutrition blended products,with a focus on powdered dairy products. Since 2014,Keytone NZ has been using its proprietary manufacturing facility in Christchurch,and has commercialised whole and skim milk powder as well as other dairy powder blends under its proprietary brands. Keytone NZ also contract-packs a range of powdered dairy products for major supermarkets,retail chains,dairy producers and other customers,in New Zealand and China,under their private label brands.

Keytone NZ's products are exported globally,including to China,for sale in a variety of channels,including major supermarket chains,premium retail channels and online marketplaces. Keytone NZ's customers and distribution channels include,New World,PAK'nSAVE,Countdown (Woolworths New Zealand subsidiary),Dairyworks New Zealand,Metro,Guangzhou Dept. & Friendship Store,HalsoKraft,JD.com,Tmall.com and VIP.com.

The offer of ordinary shares by Keytone Dairy in Australia and to qualifying investors outside of Australia is made under a prospectus dated 30 April 2018 and a supplementary prospectus dated 5 June 2018 (together the "Prospectus") which have been lodged with the Australian Securities and Investments Commission. The Prospectus is available and can be obtained from www.keytonedairy.com. A copy of the Prospectus can also be requested from Keytone Dairy's Chief Financial Officer Jourdan Thompson on the contact details below.

For further information please contact:

Jourdan Thompson,Chief Financial Officer

Keytone Dairy Corporation Limited

T: +612 9299 9690

E: investors@keytonedairy.com

This communication is not for publication or distribution,directly or indirectly,in or into,or to any person located or resident in,any jurisdiction where it is unlawful to release,publish or distribute this communication,including without limitation,the United States of America,including its territories and possessions,any state of the United States of America and the District of Colombia (collectively,the "U.S."). This communication does not constitute or form part of any offer or invitation to sell or issue,or any solicitation of an offer to purchase or subscribe for,any securities,and,without limitation,is not an offer of securities for sale into the U.S. The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933,as amended,and may not be offered or sold in the U.S.,except pursuant to an applicable exemption from registration. No public offering of securities is being made in the U.S.

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