Ann: Acquisition of The Van Diemen's Land Company, page-11

Lots to respond to here. I am no Bellamy's expert (unfortunately I missed investing in it), so bear this in mind with any observations. A very, very quick read of the Bellamy's prospectus reveals it is an 'asset light' model, it relies solely on Tatura Milk Industries for its baby formula. Now, Tatura is a subsidiary of Bega, who now is also interested in releasing a baby formula (JV with Blackmores), which may pose a risk to Bellamys (no formal supply contract in place). So where does this leave ONC / TasFoods? Well, I would presume over time, it will try and extricate itself from its low-value milk supply contracts with the supermarkets and start 'value-adding' to manufacture cheese, baby formula, etc.. This will most likely require capital, but it is in a fantastic position due to 1) being publicly listed (access to capital); 2) being located in Tasmania (water rights, less sensitive to El Nino); 3) potential for govt. subsidies, etc..

Now onto valuation which is very tricky. Previously, it was said that ~$50m in the acquisition price will be contributed to working capital, this implies the price for assets was ~$200m. Market cap of ~$260m on current earnings of ~$4m (including Meander assets) looks steep, but this is the current snapshot and now what the company will be in ~5 years. Really need a prospectus to accurately gauge this (due in December - Christmas reading).

I am thinking this is a company that has been starved of capital and now has a very, very experienced management team who already has significant dairy production at its disposal (operational experience and no greenfield risk). This is a fantastic example of being the 'food bowl' for Asia / China and it might be worth tipping in a few dollars as close to 25c as you can (because there are 1bn shares at this price). That will be my strategy.