Posted on 15 Dec 2016
Leading class action law firm Slater and Gordon and litigation funder IMF Bentham Limited have announced they are investigating a claim against Bellamy’s Australia Ltd on behalf of investors who acquired shares in the company between 14 April 2016 and 9 December 2016.
Bellamy’s shares fell by approximately 45 per cent in response to a 2 December 2016 announcement that:
- Sales were falling well below internal and market expectations;
- Regulatory reform in China was causing “temporary volume dislocation”; and,
- EBIT margins were declining.
Slater and Gordon Senior Class Actions Lawyer Mathew Chuk said initial investigations suggest Bellamy’s failed to properly disclose the company’s risks and challenges to the market.
“Bellamy’s had a reputation as a quality company selling a quality product,” Mr Chuk said.
“Our investigations to date suggest that the company prioritised preserving that reputation at the expense of properly disclosing to investors the risks and challenges that the company was facing at home and in China.”
“Furthermore, we are investigating whether Bellamy’s repeated statements to the market since April 2016 regarding its likely performance in China had the effect of misleading shareholders.”
IMF Investment Manager Simon Dluzniak said losses experienced by Bellamy’s shareholders have been significant.
“The market’s reaction to the announcement made two weeks ago was severe and shareholders are understandably nervous about the company’s next announcement,” Mr Dluzniak said.
“Investors will have lost hundreds of millions of dollars from purchasing Bellamy’s shares in a potentially misinformed market."
“We are investigating whether a class action is a viable option to recoup those losses.”
The potential class action would be funded by IMF Bentham and participants would not be required to pay any fees unless the class action is successful.
Investors who acquired BAL securities between 14 April 2016 and 9 December 2016 can register their interest in the Class Action here.