Andrew Cohen,CEO of Bellamy’s Organic.Credit:Paul Jeffers
Bellamy's chief executive Andrew Cohen said the $1.5 billion offer from Mengniu would not"change the likelihood"of Bellamy's receiving Chinese approval.
He said Bellamy's had faced a challenging regulatory environment in China in recent years,but stressed he was confident Bellamy's would get SAMR approval.
"I don't think this owner would change the likelihood of achieving that licence,or when it would be achieved. I would note that there are many people waiting for their licences,including many significant Chinese businesses,both abroad but also in Australia,"he said.
"So I'm not sure that this would either fast forward the process or sort of guarantee any kind of licences. And so I'm not sure that is the rationale for the deal."
Mr Cohen said the company's internal valuation included gaining a China licence and the offer was"evaluated against"that.
Shares in Bellamy's soared 54.9 per cent on the takeover news to close at $12.89. Morgans analyst Belinda Moore said the offer was"somewhat opportunistic"given Bellamy's earnings were depressed and it did not have the Chinese approval,adding it could spark interest from other possible suitors.
"Corporate activity was always the upside risk for Bellamy's. We think Mengniu has offered shareholders a very attractive price,especially given SAMR approval remains uncertain,"she said.
Mr Cohen described the offer as a"fair"deal for Bellamy's shareholders,while Mr Murphy said it was"compelling".
Mengniu made the approach to Bellamy's months ago,with talks becoming very serious in the past two or three weeks.
Bellamy's directors have unanimously backed the deal,urging shareholders to support it.
Mengniu chief executive Jeffrey Minfang Lu said his company wanted to lift Bellamy's sales.
"Bellamy's is a leading Australian brand with a proud Tasmanian heritage and track record of supplying high quality organic products to Australian mums and dads. This leading organic brand position and Bellamy's local operation and supply-chain are critical to Mengniu,"he said.
The proposed deal comesless than three weeks after Bellamy's reported its full year results,with the company's full year profit almost halving to $21.7 million.
A Tasmanian government spokesman said investment was welcome in Tasmania and it would engage with Mengniu to get a better understanding of the proposed deal.
"The government's number one priority is jobs and we look forward to hearing the plans Mengniu has to grow and invest in Tasmania."