Goodman Fielder, the Australian and New Zealand foodmaker, rejected a A$1.3 billion ($1.5 billion) offer from Wilmar International and First Pacific Co., saying it “materially undervalues” the company.

The conditional proposal of 65 cents a share, 18% more than Goodman Fielder’s last close in Sydney, comes almost two years after an approach from Wilmar failed to result in a deal. Wilmar, the company’s third-largest shareholder, bought its 10% stake in February 2012.

A takeover would add brands including Meadow Fresh yogurt, Olive Grove margarine and Wonder White bread to Wilmar and First Pacific’s Chinese and Southeast Asia-based consumer businesses. Chinese shoppers prefer imported food and beverages due to concerns over quality and food safety, according to focus-group analysis quoted in a Nov. 8 report by the Hong Kong Trade Development Council, a government agency.

“Chinese consumers view local producers with a huge degree of skepticism,” Carey Wong, research manager at OCBC Investment Research in Singapore, said by phone. “If Wilmar brings in a foreign brand made in New Zealand that would eliminate a lot of the hurdles to developing a brand from scratch.”

Goodman Fielder climbed 19% to 65.25 cents at 2:27 p.m. in Sydney, while its New Zealand stock rose 22%.

The acquisition, via a 50-50 joint venture of the two suitors, would aim to “create a leading Asia-Pacific agricultural and consumer staples company”, First Pacific said in a regulatory statement in Hong Kong.

SUGAR DEAL

It would be Wilmar’s biggest takeover since its A$1.54 billion purchase of CSR Ltd.’s Australian sugar business in 2010, according to data compiled by Bloomberg. In U.S. dollar terms, it would be the third-biggest food takeover in the Asia- Pacific over the past five years, the data show.

Wilmar, the world’s largest palm oil trader, is seeking to use existing relationships with grocers in Asia to expand from its agricultural commodities business into more branded products, Wong said.

Its main consumer brands are currently cooking oils, including the Arawana label in China and Fortune in India and Indonesia, according to its website. In 2012 it set up a joint venture with Kellogg Co. to sell its cereals and Pringles potato chips in China.

PT Indofood Sukses Makmur, a Jakarta-based food company controlled by First Pacific, distributes Cheetos and Lay’s potato chips, Maggi seasoning, and Orchid Butter in Indonesia.