(Reuters) - China Mengniu Dairy Company Ltd <2319.HK> will buy infant formula maker Bellamy's Australia Ltd <BAL.AX> for A$1.43 billion ($983 million), both companies said on Monday, sending Bellamy's shares soaring.
The A$12.65-per-share deal represents a 52% premium to Bellamy's Friday closing price of A$8.32, excluding a special dividend of A$0.60 per share paid by Bellamy's prior to implementation of the scheme.
Shares of the infant formula maker jumped nearly 53% within the first few minutes of trading, and sit at their highest level in more than a year.
Bellamy's board unanimously recommended shareholders vote in favour of the offer.
"It (Mengniu) offers a strong platform for distribution and success in China, and a foundation for growth in the organic dairy and food industry in Australia," Bellamy Chief Executive Officer Andrew Cohen said in a statement.
Bellamy's said last month its annual profit had almost halved as sales dropped 19%, hampered by a Chinese crackdown on imports by unregistered traders.
The company has faced increasing challenges with tighter Chinese customs rules for e-commerce purchases crimping informal exports to China.
(Reporting by Aby Jose Koilparambil and Nikhil Kurian Nainan in Bengaluru; Editing by Sam Holmes and Stephen Coates)
