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Bellamy’s share price: where next as $1.5bn takeover approved?

The Bellamy’s share price has edged to the $13.23 mark after the company announced that the Supreme Court of New South Wales had approved Mengniu’s $1.5 billion takeover offer.

Bellamy's obtains takeover approval Source: Bloomberg

Was there ever actually a conspiracy to push down Bellamy’s (ASX: BAL) share price, thus making it a potentially more attractive takeover target?

Or was such speculation – the kind you may see in a day-time straight-to-TV-movie – nothing more than that: a fiction?

That was the key question we pondered when we first reported on Mengniu’s $1.5bn takeover bid. Or specifically, and in the words of Greens Senator Peter Whish-Wilson, there was the calling for an investigation into:

‘Whether any actions by the Chinese government, including withholding import approvals, constitute a conflict of interest and could reasonably be seen to be market manipulation.’

Either way, such musings are of little consequence at this point. Likely to the relief of shareholders in Australia and abroad, at 15:25 AEDT today Bellamy’s revealed that Mengniu’s takeover bid had been approved by the Supreme Court of New South Wales.

This caps off the last requirement for the $1.5bn takeover to be finalised, with Bellamy’s receiving FIRB and shareholder approval in the weeks prior to today’s afternoon announcement.

Bellamy’s share price: where next?

Ultimately, the nature of the takeover deal has today remained unchanged: Bellamy's shareholders will receive $13.25 cash per share – for those holding the company's stock as of 19.00pm AEDT, 17 of December – according to today’s release.

This will be made up of a $12.65 cash per share payment, made by Mengniu; as well as a fully-franked special dividend of 60 cents per share, paid by Bellamy's.

Commenting on when the situation will truly be finalised, the company noted that:

'The Scheme Consideration will be paid by Mengniu on the implementation date, which is scheduled to be on Monday, 23 December 2019. The Special Dividend will be paid by Bellamy's on the implementation date, immediately prior to implementation of the Scheme.'

The Bellamy’s (ASX: BAL) share price moved in-sync with these details, edging up to $13.23 per share as today’s session came to a close.

As was alluded to: this deal does look to be in the best interest of shareholders, overall. Indeed, when the Mengniu takeover was first announced, the price on offer, representing a '54% premium to the 3-month volume weighted average price to 12 September 2019 of $8.59’ did indeed cater to shareholder interests.

That is of course unless you bought in or around Bellamy’s March 2018 peak – when the company’s stock floated around the $20 per share mark.

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