Wyeth An Appealing But Financially Daunting Deal For Mengniu

While Swiss food giant Nestlé and European food major Danone have been linked to an acquisition of Pfizer's infant nutrition business Wyeth, Mengniu Dairy's name has recently been thrown into the ring as well. According to Bloomberg, Chinese dairy giant Mengniu is contemplating a bid for Wyeth, which is valued at around US$10bn. However, Mengniu has refuted such speculation and claimed that it has 'no concrete arrangement or plan in connection with the bid'. While we see compelling reasons for Mengniu to acquire Wyeth given the dairy unit's strong brand appeal and extensive reach across emerging markets, an acquisition of Wyeth would be financially stretching for the Chinese dairy giant, which could probably explain Mengniu's reservations about the acquisition.

To read the full article, please choose one of the following options: