Infant formula group The a2 Milk Company’s major supplier Synlait has been forced to take up an emergency $NZ130 million ($120.2 million) loan from a big Chinese shareholder as its financial plight worsens.

Synlait also said on Monday it had ditched a sale process for its New Zealand Dairyworks cheese business after offers were deemed too low. It warned that profits would come in at the low end of a forecast range, and that it faced a mass exodus of farmer suppliers.