Andrew Forrest considers buying Lion’s dairy business

Andrew Forrest has joined the tyre kickers looking at Lion’s dairy business, after the blocking of its sale to China’s Mengniu.

Andrew Forrest is taking a look at Lion’s dairy assets, up for sale after the rejection of a Chinese deal.

Billionaire mining magnate Andrew Forrest has joined the tyre kickers looking at Lion’s proposed $600 million dairy sale through his private investment arm Tattarang.

Lion Dairy and Drinks has opened the door until mid-December to test the market for the sale of the dairy business after the federal government intervened to stop its sale to China-based Mengniu.

The plan is to proceed with a formal process if there is sufficient interest, with an emphasis on a deal which can be done quickly without need for Australian Competition and Consumer Commission or Foreign Investment Review Board approval.

Known to be interested are Bega Cheese, John Wylie’s Tanarra Capital - leading a consortium of industry funds - and Tattarang.

Just whether the expressed interest turns into a deal remains to be seen. Lion has made clear that if there is not the right interest it will keep the business under Kathy Karabatsas.

The assets include a large cold distribution arm with fridges in corner stores, Pura Milk and contracts with Coles and Woolworths for house brand milk, plus Big M flavoured milk and Yoplait yoghurt.

Forrest’s interest following the Chinese withdrawal is notable, given his close ties to China through Fortescue Metals Group.

The FIRB approved the Mengniu deal at officials level but Treasurer Josh Frydenberg intervened in the planned transfer from a Japanese to Chinese company.

Tattarang is the new name for Forrest’s private commercial interests which include seafood, cattle stations, wind energy and Sun Cable, the solar power project with Atlassian’s Mike Cannon-Brookes.