China’s Mengniu Dairy has made a bid to acquire Bellamy’s – Australia’s largest organic infant formula producer – for approximately AUS 1.5 billion ($1 billion).
Bellamy’s board of directors have unanimously approved the deal, which will see Mengniu acquire 100% of Bellamy’s shares, and urged shareholders to accept the offer.
The deal still needs to be approved by Australian regulatory authorities, including the Foreign Investment Review Board (FIRB) and the New South Wales Supreme Court.
China is the world’s largest importer of infant formula products, but according to Australian publication WA Today, Bellamy’s does not have a licence to operate within the Chinese market from China’s State Administration of Markets/Regulations (SAMR).
Bellamy’s is still awaiting a licence from the SAMR to sell its organic infant formula in Chinese retailers over 20 months after it lodged its application, though the company claimed it was ‘optimistic’ about gaining a licence in the near future.
Mengniu stated that it will seek to increase the company’s sales in Australia and throughout the Asia Pacific region, if the transaction is approved.
Jeffrey Minfang Lu, CEO of Mengniu said: “Bellamy’s is a leading Australian brand with a proud Tasmanian heritage and track record of supplying high-quality organic products to Australian mums and dads.
“This leading organic brand position and Bellamy’s local operation and supply-chain are critical to Mengniu.”
Bellamy’s CEO, Andrew Cohen, added: “Mengniu is a pre-eminent dairy company in China and an ideal partner for our business. It offers a strong platform for distribution and success in China, and a foundation for growth in the organic dairy and food industry in Australia.
“This transaction can further deliver on our founder’s original vision of a truly iconic Australian brand and ‘A Pure Start to Life’ for the world.
“Our employees, our trade partners and local organic manufacturers will continue to grow and thrive with the success of our business.”
© FoodBev Media Ltd 2020