CIADY - China Mengniu Dairy: Acquisition Of Infant Formula Company Is The Right Move But The Wrong Price
Elevator Pitch
Hong Kong-listed Chinese dairy company China Mengniu Dairy Co., Ltd. (CIADF) (CIADY) [2319:HK] recently announced a proposed acquisition of Australia's largest organic infant formula company, Bellamy's Australia Limited (BLLMF) [BAL:AU]. Although I think that this proposed acquisition is a right move for the company due to various reasons, which I will elaborate on in this article, I think that China Mengniu is possibly overpaying for Bellamy's Australia with an acquisition price implying a consensus forward P/E of 45.2 times.
This is an update of my original initiation article on China Mengniu published on