Sale of Australian dairy business Lion Dairy to China fails after Treasurer disapproves

The sale of an Australian dairy business to a Chinese company has been abandoned after Treasurer Josh Frydenberg deemed it “against the national interest”.

A Japanese-owned beverage giant’s plans to sell its Australian dairy and fruit juice business to a Chinese company has collapsed after failing to get the blessing of Treasurer Josh Frydenberg.

Kirin struck a deal in November to divest its Lion Dairy and Drinks subsidiary to China Mengniu Dairy. The Australian Competition and Consumer Commission allowed the sale in February.

But Kirin advised on Tuesday the companies had mutually decided to abandon the deal as they had not secured federal government approval.

“This follows the communication of my preliminary view to Mengniu Dairy that the proposed acquisition would be contrary to the national interest,” Mr Frydenberg said in a statement.

Kirin said the future of Lion Dairy and Drinks would be re-examined.

The business produces well-known brands including Pura milk, Vitasoy, Farmer’s Union, Daily Juice Company, Masters milk, Yoplait yoghurt and Dare iced coffee products.

The development comes amid increasing trade tensions between China and Australia.