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Hungary bans foreign takeover of dairy company citing supply safety concerns
Published by Global Banking and Finance Review
Posted on September 16, 2025
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BUDAPEST (Reuters) -Hungary's government has banned the foreign takeover of dairy company Alfoldi Tej Kft, citing supply safety concerns and national interests, the Economy Ministry said on Tuesday.
The Economy Ministry said a foreign investor it did not identify had sought to acquire all shares in the dairy maker, which the government says accounts for nearly a fifth of raw milk purchases in the country.
Prime Minister Viktor Orban's nationalist government, which has been stepping up its opposition to foreign takeovers of key companies, said a foreign takeover would mean raw milk would be exported and dairy products produced abroad would be purchased at higher prices than before, without giving details.
"Due to its significant market share, (a) foreign acquisition could cause substantial market disruption in domestic milk production and procurement, as well as high supply security risks," the Economy Ministry said in a statement.
It was not immediately clear whether the prospective buyer was based in the European Union. A spokesman for the European Commission said it could not comment immediately on the decision.
Officials for Alfoldi Tej Kft, which is owned by a group of Hungarian investors, did not immediately respond to emailed questions for comment. The ministry said that following the ban, the company had raised the possibility of selling itself to the state under the same conditions, which the government is examining.
In June, Orban's government modified Hungary's foreign investment framework, granting the government pre-emption rights for inward mergers and acquisitions transactions and enabling it to acquire stakes in companies originally targeted by foreign investors.
Founded in 2003, Alfoldi Tej Kft employs more than 700 people and processes nearly 270 million litres of milk per year based on information published on its website.
(Reporting by Gergely Szakacs; Editing by Susan Fenton)