(Recasts with shareholder refund, ADDS CEO comment, background)
July 17 (Reuters) - Infant formula maker Bellamy’s Australia Ltd on Monday offered to refund investors in a recent capital raising that funded a factory purchase, because Chinese authorities suspended the factory’s export licence soon afterward.
It also forecast second-half earnings to show a loss of between A$9.5 million ($7.42 million) and A$14 million, at the upper end of its guidance.
The company in June announced a A$60.4 million rights issue to back a turnaround strategy based on its acquisition of Camperdown Powder Pty Ltd, a formula cannery in Melbourne with a licence to export to China.
But on July 7 Bellamy’s said Chinese authorities had suspended Camperdown’s export licence, throwing plans for the firm to regain ground in its largest export market into disarray.
Investors can return shares bought in the rights issue and be reimbursed by the company, with any capital shortfall to be underwitten by two major shareholders, Janchor Partners Limited and Delta Partners LP, Bellamy’s said on Monday.
CEO Andrew Cohen said in the statement the company has now submitted detailed responses to each enquiry from China’s Certification Accreditation Administration, the body which suspended the Camperdown licence.
The Chinese regulator had not made any findings against Camperdown, Bellamy’s said.
Bellamy’s shares have been suspended from trading since July 7 following Camperdown’s licence suspension. They are expected to resume trading on Thursday, the company said.
The stock last traded at A$6.74, sharply down from a peak around A$15 last August and giving the company a market value of A$693 million ($526 million). ($1 = 1.2802 Australian dollars) (Reporting by Christina Martin in Bengaluru; Editing by Tom Westbrook and Stephen Coates)