In a short press release issued today, the Chinese dairy company said it was pulling the plug on the deal as one of the conditions stated in the announcement has not been fulfilled on the conditions precedent end date.
Mengniu said the parties agreed in writing on August 24 to terminate the share sale and purchase agreement.
Australian Government Treasurer Josh Frydenberg had earlier said he had advised Mengniu that the sale of Lion Dairy and Drinks “would be contrary to the national interest.”
In November 2019, Mengniu announced the purchase of LDD from Japan’s Kirin Holdings Company Limited for A$600m (US$407m).
At the time, Kirin and Lion said they considered all options for LDD, from a continuation of investment and retaining the business to a sale of LDD. Kirin and Lion determined that the best option would be to transfer LDD to a third party that could maximize its growth potential.
Lion had already sold its specialty cheese business to Saputo Dairy Australia for A$280m (US$190m), a subsidiary of Canada’s Saputo Inc., which concluded on October 28.
In February, the Australian Competition and Consumer Commission (ACCC) said it would not oppose the proposed acquisition of Lion Dairy & Drinks after closely considering the potential impact on competition.