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Australian baby formula company Bellamy’s to be taken over by Chinese company Mengniu in $1.5bn deal

Australian baby formula company Bellamy’s to be taken over by Chinese company in $1.5bn deal

  • China Mengniu Dairy Company has offered to buy 100% of Bellamy’s shares 
  • Bellamy’s board has unanimously recommended shareholders approve the deal
  • Mengniu offered $12.65 per share and Bellamy’s said it would pay a dividend 
  • Bellamy’s shares soared to $12.94 on the back of the news on Monday morning

Australian baby formula company Bellamy’s is set to be taken over by a Chinese firm.

China Mengniu Dairy Company has offered to buy 100 per cent of Bellamy’s shares in a $1.5billion deal.

The Bellamy’s board has unanimously recommended that shareholders approve the deal which would be done by the end of this year if they agree. 

Bellamy's CEO Andrew Cohen (right) described Mengniu as an 'ideal partner'

China Mengniu Dairy Company has offered to buy 100 per cent of Bellamy’s shares in a $1.5billion deal. Bellamy’s CEO Andrew Cohen (right) described Mengniu as an ‘ideal partner’

Mengniu offered $12.65 per share and Bellamy’s said it would pay a dividend of 60 cents per share, meaning shareholders get $13.25 per share.

That is a 59 per cent premium on Friday’s closing price of $8.32.

Bellamy’s shares soared to $12.94 on the back of the news on Monday morning.

Mengniu is a huge dairy company listed on the Hong Kong Stock Exchange with a market capitalisation of $24.6billion.    

The deal would need to be approved by the Foreign Investment Review Board – but Bellamy’s is confident approval would be granted.

Board member John Murphy told the ABC: ‘At this stage we’re in the process with FIRB. We’re having full engagement and are co-operating in that process. 

‘It has a way to run, but we’re feeling very positive. We don’t want to get ahead of that process, we’ll let it play through but at this stage we’re feeling very positive that it will run a course.’

Bellamy’s CEO Andrew Cohen described Mengniu as an ‘ideal partner’.

‘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,’ Mr Cohen said.

Mengniu chief executive officer Jeffrey Minfang Lu said taking over Bellamy’s would give it critical access to the Australian market. 

‘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,’ he said.

Read more at DailyMail.co.uk