21 Aug Australia to block Chinese firm’s $600 million takeover of milk brands
Australia is set to block China Mengniu Dairy’s proposed A$600 million takeover of some of the nation’s biggest milk brands, as diplomatic and trade tensions push relations between the two countries to a new low.
According to sources close to the transaction, Australia’s treasurer Josh Frydenberg has told state-owned China Mengniu his preliminary view is that the takeover of the Lion Dairy brands, owned by Japan’s Kirin Holdings Co, should not proceed.
Lion Dairy & Drinks is Australia’s second biggest milk processor, producing about one billion litres of milk a year. It owns brands such as Pura Milk, Dairy Farmers and Yoplait.
Frydenberg has reportedly written to the Chinese company to inform it of his decision and also to give it an opportunity to provide remedies or reasons why he should change his mind.
Sino-Australian relations have deteriorated since Canberra called for an independent inquiry into the origins of the COVID-19 outbreak in Wuhan in April. Since then, Beijing has slapped punitive tariffs on Australian barley, restricted some beef imports and initiated an anti-dumping inquiry into wine imports earlier this week.