Since you are a BAL shareholder you might find this excerpt from a article from FP of interest to you that was posted up today.
Organic infant formula maker, Bellamy’s Australia has just clinched itself a delicious offer all the way from China, which has pushed the shares up dramatically from last Friday’s close. This was timely given that the company issued a weaker-than-expected FY19 ,whilst some regulatory approvals remain uncertain.
China Mengiu Dairy Company has launched an offer for Bellamy’s pitched at $13.25 per share, comprising a $12.65 cash component and a franked special dividend of 60 cents per share, paid by Bellamy’s. The cash offer values Bellamy’s at $1.5 billion and is at a 59% premium to Friday’s closing price of $8.32. The stock finished yesterday’s session some 55% higher on the announcement at $12.89, not far away from the cash offer, with the market seemingly of the view that it is a ‘done deal’ or that a higher offer may be forthcoming.
The takeover is a good outcome for shareholders, however we believe there are risks to the deal going through, including regulatory/government approval. As outlined in yesterday’s mid-week alert, and in the interests of prudence, we are recommending Members sell half their shares to take some profits off the table.
Consequently, we continue to recommend Members sell half their exposure in Bellamy’s Australia at the current price levels.
BAL Price at posting:
$12.86 Sentiment: None Disclosure: Not Held
