Wattle seals China deal

WATTLE Health Australia shares have soared after the infant formula supplier said it had bought a stake in formula maker Blend & Pack, helping to secure its business in China.

Shares in Wattle Health closed up 10.5c at 58c yesterday after hitting 62c in intraday trading.

Wattle Health revealed it had paid $5 million for a 5 per cent stake in Blend & Pack, one of eight infant formula plants in Australia licensed by Chinese authorities to produce infant formula for China’s market.

The company will nominate Wattle Health Infant Formula for accreditation with the China Food and Drug Authority under new regulatory requirements coming into force from January.

That means Wattle can continue to supply China with its infant formula online and through shops.

Chinese regulators this month suspended import accreditation for products from a cannery acquired this year by major infant formula supplier Bellamy’s Australia.

Wattle Health already holds accreditation for its infant formula range, allowing it to sell its products in Chinese stores and through online markets.

But from January 1, currently licensed infant formula plants can only nominate up to three brands for accreditation.

“This deal places Wattle Health Australia in a strong position,” said chairman Lazarus Karasavvidis.