While there is still significant uncertainty surrounding whether Bellamy’s Australia (ASX:BAL) will be swallowed by a Chinese dairy company, the news has been enough to inject some momentum into the sector.

After a barren August, in which the majority of the ASX’s dairy formula players had suffered share price losses amid a lot of red ink from financial season, the mini-sector was up 11 per cent in September.

That is largely thanks to Bellamy’s, which revealed in mid-September that it had entered a scheme of arrangement with China Mengniu Dairy, by which Mengniu would acquire Bellamy’s in full, valuing the Aussie infant formula stock at $1.5 billion.

The company’s board is unanimously recommending the deal go ahead but it needs not only shareholder approval, but also NSW Supreme Court and Foreign Investment Review Board (FIRB) approval. Its CEO, Andrew Cohen, will pocket nearly $15 million if it goes ahead.

Bellamy’s shares have risen 74 per cent in the last month, to $12.98 a pop. The company has been closely followed by other infant formula players, with Wattle Health (ASX:WHA)Clover (ASX:CLV), Keytone Dairy (ASX:KTD), Australian Dairy Nutritionals (ASX:AHF) and Bubs Australia (ASX:BUB) all trading upwards.

“We note Bellamy’s announcement; this news has generated a considerable market interest for WHA and has created a positive impact in the sector overall,” was Wattle Health’s take after the ASX asked it why its shares had jumped. The company is currently in a trading halt pending an update on its proposed acquisition of Blend and Pack, which recently renewed its General Administration of Customs of the People’s Republic of China (GACC), which allows companies to export to China.

Keytone recently received its first two orders for milk powder from Walmart China, while AHF is set to begin production after relocating its infant formula plant.

Here’s the list of ASX small cap stocks with dairy operations that have exposure to China, click headings to sort

Code Name Price (1 Oct 2.30pm) Market Cap 1-yr return 1-mnth return
BAL BELLAMY'S AUSTRALIA LTD 12.98 $1.5B 27 74
WHA WATTLE HEALTH AUSTRALIA LTD 0.53 $103.1M -51 36
CLV CLOVER CORP LTD 3 $512.2M 93 34
BFC BESTON GLOBAL FOOD CO LTD 0.12 $46.6M -33 25
KTD KEYTONE DAIRY CORP LTD 0.475 $105.4M -26 16
AHF AUSTRALIAN DAIRY NUTRITIONAL 0.13 $49.6M -7 8
BUB BUBS AUSTRALIA LTD 1.32 $688.5M 109 8
SM1 SYNLAIT MILK LTD 8.51 $1.5B -14 -3
AU8 AUMAKE INTERNATIONAL LTD 0.125 $43.2M -61 -4
JAT JATENERGY LTD 0.058 $44.7M 33 -5
HRL HRL HOLDINGS LTD 0.11 $49.3M -35 -8
LON LONGTABLE GROUP LTD 0.165 $36.3M -60 -8
BXN BIOXYNE LTD 0.018 $11.5M -51 -10
A2M A2 MILK CO LTD 12.17 $8.9B 19 -10