Mengniu Dairy has made an investment in a fellow Chinese group that owns a prominent business in Australia.
Following the announcement of two acquisitions in Australia in 2019, Mengniu has struck a deal to buy 5% of Shanghai Ground Foods Tech Co., a company also known as Ground Food, that owns Perth-based Brownes Dairy.
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Shanghai-listed Ground Food said Mengniu had agreed to pay CNY14 (US$2.02) a share for more than 20m shares.
In a stock-exchange filing, Ground Food said the companies had “agreed to actively carry out the development and promotion of various cheese products, and co-build sales channels”.
Ground Food said having Mengniu, one of China’s largest dairy companies, as an investor would “strengthen” its cheese business.
Shanghai-based Ground Food acquired Brownes in late 2017 from Australian private-equity firm Archer Capital as part of a consortium that also had investment firm Changchun Lianxin Investment Consulting Company as a member.
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By GlobalDataIn November, Mengniu agreed a deal to acquire Australia-based Lion Dairy & Drinks for AUD600m (then US$407.5m), pending approval from Australia’s competition watchdog and the country’s board that oversees foreign investment.
The announcement came a week after Australia’s overseas investment regulator gave the green light to Mengniu’s acquisition of infant-formula maker Bellamy’s Australia.
