China Mengniu Dairy buys Kirin Australia unit for A$600m

[BENGALURU] China Mengniu Dairy Co Ltd on Monday said its unit has entered into an agreement to buy Australia-based dairy and beverages firm Lion-Dairy & Drinks Pty Ltd for A$600 million (S$556.4 million).

Mengniu Dairy, part-owned by the Chinese government, is buying the producer of mainly milk-based beverages and yoghurt from a unit of Tokyo-listed Kirin Holdings Co Ltd.

According to a statement from China Megniu, Lion-Dairy has a leading market share position for a number of its product categories within Australia and also has a presence in international markets including South-east Asia and China, primarily through yoghurt products.

China Mengniu's latest acquisition comes nearly two weeks after the Australian government gave conditional approval to the Chinese firm's acquisition of local infant formula maker Bellamy's Australia Ltd for A$1.43 billion.

Acquisitions by Chinese companies are facing increased scrutiny globally, particularly in the technology space, after the US raised security concerns.

The Bellamy's decision showed that the Australian government is ready to welcome Chinese money into a politically sensitive industry at a time when relations between the countries have been strained.

REUTERS