Chinese company’s $600M bid for dairy concern rejected
A CHINESE company's $600 million bid to buy a major Australian dairy firm has fallen over due to foreign investment concerns.
China Mengniu Dairy had signed a deal to buy Lion-Dairy and Drinks, which produces major brands like Pura, Big M, Farmers Union and Berri, in November.
But the companies announced on Tuesday the deal was being terminated because it was unlikely to get approval from the Foreign Investment Review Board.
Treasurer Josh Frydenberg confirmed in a statement the companies' decision to end the deal came after he had informed Mengniu Dairy that "the proposed acquisition would be contrary to the national interest".
It has sparked questions over the Foreign Investment Review Board's previous approval for the same Chinese company's takeover of Tasmanian baby food manufacturer Bellamy's.
Tasmanian senator Jacqui Lambie praised the outcome, saying she was "shocked" to learn the FIRB had a 'reject' stamp.
"This is a sensible outcome and it's better for the national interest that it's been rejected," she said.
Senator Lambie added: "Not all foreign investment is good foreign investment."
"We've seen companies be bought out, subject to conditions, only for those conditions to be ignored completely and nobody does anything about it."
Fellow crossbench senator Rex Patrick said the Treasurer would "need to explain why this Chinese takeover proposal deal hasn't got FIRB approval, but the earlier acquisition of the Tasmanian dairy company, Bellamy's Australia did".
"The Government needs to adopt a firm, clear and consistent policy to prevent foreign takeovers that are not in Australia's national interest," he said.
Tasmanian Greens Senator Peter Whish-Wilson is demanding more scrutiny of the decision.
He will call for a special hearing of a Senate inquiry being conducted into foreign investment proposals to investigate it further.
The deal was rejected despite Australia's consumer watchdog announcing in February that it would not oppose the sale.
Business: page 20
Originally published as Chinese company's $600M bid for dairy concern rejected