We recently reported on the potential acquisition of Bellamy’s and now investors have backed the A$1.5 billion (US$1 bn) takeover by Mengniu, with 99.23% voting in favour.
For the deal to be approved, Tasmanian-based Bellamy’s will apply to the Supreme Court of NSW, and the deal is expected to be implemented by the end of the year.
Andrew Cohen, Bellamy's chief executive told The Sydney morning Herald, that Mengniu “has a very long-term vision” for the infant formula company, adding that this deal was in the national interest. Cohen will remain CEO in the company.
The deal had initially aroused some political controversy with several senators in the country.
Senator Peter Whish-Wilson questioned if the bid was "inconsistent with the national interest test" under foreign acquisitions and takeovers law.
Senator Jacqui Lambie had also expressed concerns on whether this would lead to fewer infant formula available for locals and warned against a "Communist Chinese takeover" of Australian companies.
However, Treasurer Josh Frydenberg had imposed conditions on the deal including the company remaining headquartered in Australia for at least a decade, and that its board of directors to be run by a majority Australian board.
The Treasurer also required Mengniu to invest at least A$12 million (US$8m) in infant milk formula processing facilities in Victoria.
Bellamy’s chairman John Ho said that Bellamy’s would maintain its Australian heritage: "Whatever owner, we're still going to be Australian, I think that's important. This company or other companies that are being acquired are not turning into some other nationalities," reported The Sydney morning Herald.
Lion Dairy & Drinks
Last month, Mengniu bought a part of Australia’s Lion Dairy & Drinks for US$419 million. The deal includes milk, yoghurt and juice products. The beer, wine and spirits business continue to belong to Kirin Holdings.
The deal is expected to close H1 2020.
The Chinese government had been gradually intensifying efforts to boost the industry and consumer confidence after the 2008 milk-tainted infant formula scandal. The government earlier this year announced it would support local dairy firms in overseas ventures, and encourage foreign dairy firms to invest in China.