The Bellamy's Australia Ltd (ASX: BAL) share price will be on watch on Thursday after its takeover took a big step forward.
What happened?
After the market close on Wednesday, Bellamy's provided an update on its takeover approach by China Mengniu Dairy Company Limited.
According to the release, the Supreme Court of New South Wales has made orders approving the despatch of the Scheme Booklet to Bellamy's shareholders in relation to the proposed acquisition of it by way of a scheme of arrangement.
In addition to this, the Court has also ordered that a meeting of Bellamy's shareholders be convened to consider and vote on the proposed scheme. This meeting has been scheduled for December 5 in Melbourne.
What's next?
Bellamy's has advised that the scheme booklet is expected to be registered with ASIC and released to the ASX on Thursday. After which, a copy, including the independent expert's report and a scheme meeting notice, is expected to be sent to shareholders on November 4.
Should shareholders vote in favour of the scheme, the takeover will have cleared most of its hurdles. Though, it still requires approval by the Foreign Investment Review Board.
If it receives that approval, then shareholders can look forward to receiving both $12.65 cash per share and a $0.60 per share fully franked special dividend.
Will shareholders vote for the deal?
Whilst the offer price is lower than the share price that some investors may have paid in 2018, it seems quite likely that shareholders will vote in favour of the scheme.
Especially with its board unanimously recommending that shareholders vote in favour of the scheme, in the absence of a superior proposal and subject to an independent expert.
Bellamy's chair, John Ho, said: "The proposed Scheme is an attractive all-cash transaction at a 59% premium to the prevailing share price. It reflects the strength of the Bellamy's brand, the dedication of 160 passionate employees and the progress of our turnaround plan."
The company's deputy chair, John Murphy, added: "Following careful consideration of the offer, the Bellamy's Board has unanimously concluded that the Scheme is in the best interests of shareholders."
