Bubs enters into trading halt ahead of capital raising announcement
Written on the 14 June 2018 by David Simmons
After last week's news that Bubs Australia (ASX: BUB) is making a significant push into the Chinese market the company has entered into a trading halt on Thursday morning.
The company says the trading halt has been requested pending an announcement by Bubs in relation to a capital raising.
Last Friday the Australian infant milk formula company announced it had partnered with leading Chinese e-commerce platform Alibaba to sell its products on the Tmall Global store.
Alibaba has 580 million monthly users across its different apps, with mother and baby products the second largest category on Alibaba, spearheaded by infant formula.
Bubs expects the Global Merchandise Value to be in excess of approximately $1 million in the first year of trading.
The company also made a significant step toward getting its product ready for the Chinese market after entering into a deal with Australia Deloraine Dairy (ADD) last Friday.
ADD is one of only 15 licenced facilities in Australia authorised by Certification and Accreditation Administration of the People's Republic of China to produce infant formula products eligible for importation into China.
Bubs Australia chairman Dennis Lin says this is an important step to getting its products into China.
"This strategic partnership is a crucial step in achieving China Food and Drug Administration (CFDA) registration, enabling us to advance our China expansion strategy," says Lin.
"There is an increasing demand for goat milk based infant formula in China, especially in Mother and Baby stores. The Manufacturing Agreement will facilitate our CFDA registration and provide a defined pathway to maximising Bubs' access to 80,000 stores aligned with our partner QuanJaiWanPu, China's largest nationwide distributor of infant formula."
More to come.
Business News Australia
Author: David Simmons