China Mengniu Dairy to acquire infant formula producer Bellamy’s

China Mengniu Dairy has signed a scheme implementation deed to acquire 100% of the issued share capital of infant formula producer Bellamy’s Australia for A$1.5bn ($1.03bn).

The Chinese firm has agreed to pay A$13.25 ($9.11) cash per share, which includes A$12.65 ($8.7) cash per share and A$0.60 ($0.41) as a special dividend to the shareholders.

China Mengniu Dairy CEO Jeffrey, Minfang Lu 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.

“Our sales growth ambitions for Bellamy’s in Australia and the broader Asia Pacific region will see investment in the local dairy industry to ensure the required capacity is in place to achieve these plans.”

The transaction was unanimously approved by Bellamy’s Board of Directors, and the directors urged stakeholders to vote in favour of the deal.

Implementation of the scheme is subject to the approval of Bellamy’s shareholders, the court and the Australian Foreign Investment Review Board (FIRB).

For this transaction, Bellamy’s was advised by Allens and Morgan Stanley.

Bellamy’s CEO Andrew Cohen said: “Mengniu is a preeminent 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.”