(Yicai Global) Sept. 1 -- China Mengniu Dairy Co. [HK:2319] does not wish to acquire China Huishan Dairy Holdings Co. [HK:6368], Lu Minfang, president and executive director of Mengniu Dairy, said after his company's interim report briefing yesterday.
The industry had speculated that Mengniu was very likely to take over Huishan.
Lu had responded to talk about such a deal at Mengniu's 2016 annual results briefing in Hong Kong in March this year. If the market demonstrates strategic demand, Mengniu Dairy's parent will pay close attention to investment opportunities in the domestic dairy industry, he said at the time.
In March, he said that Mengniu would not buy Huishan as long as it was not in line with Mengniu's strategy, and would only make the acquisition if it met his company's needs. Yesterday, he made it clear that Mengniu is not interested in purchasing Huishan.
Huishan experienced a debt crisis that led to concerns about the financing environment for Hong Kong-listed dairy companies. Mengniu is a very healthy firm with strong ratings, and it has abundant cash flow, Lu said. Huishan's debt crisis will not have any impact on Mengniu, he said.
Mengniu's first-half sales revenue was USD4.47 billion (CNY29.47 billion), up 8.1 percent from a year ago, its interim report shows. Net profit rose 4.7 percent to CNY1.13 billion.