Bubs to the rescue as special operation gets underway

Shareholders of Bubs Australia (ASX: BUB) reveled in every small cap investors’ dream over the weekend – a direct shoutout from the President of the United States.

And this morning the President issued a follow-up that will renew shareholders’ excitement – it might not quite get the attention of an incendiary ex President Trump tweet, but it is significant nonetheless.

Bubs is fast tracking its agreed upon sale to the US with Operation Fly Formula that will get Bubs 1.25 million infant formula tins to parents in need. With the first airfreight flights scheduled on 9 and 11 June 2022.

The reason Bubs is being brought in to fast track deliveries to the States is because of an alarming supply crisis for infant formula that has triggered panic buying over the last few weeks, further exacerbating the issue.

How did we get here? In addition to covid related supply shortages, a key manufacturing plant for formula in Michigan closed in February after a federal investigation was started in relation to a number of bacterial infections found in babies who received their formula. 

The outcome of the investigation is unknown, but if this incident is perceived as anything like the 2008 Chinese infant formula scandal, Australian formula exports could once again be seen as worth their weight in gold.

Bubs Australia shares rose to a high of $0.68 following the weekends’ announcements, a rise of 48% from Friday’s close. Other infant milk producers such as A2 Milk (ASX: A2M) also enjoyed share price spikes, albeit not to the same degree.

During a roundtable discussion with President Biden, Bubs Founder and CEO Kristy Carr commented “It was an insightful roundtable convened by the President, and the participants shared many important learnings and experiences. It was pleasing to hear that FDA regards safety as the highest priority, and Bubs satisfies those gold standards.”

“We were also interested to learn that the Administration is seeking to understand the broader regulatory environment going forward. We are thankful that the US Government continues to offer support and work with us. Australia and the United States have enjoyed a long-term friendship. We are proud to be representing our country in providing a first response to assist American families.”