Concerns about potential market manipulation will be raised with Treasurer Josh Frydenberg before an approval decision on a $1.5 billion Chinese takeover bid for Bellamy's Australia Limited.
The Tasmanian-based former market darling's share price crashed in early 2018 partly due to the implications of a delay in accreditation from Chinese authorities which affected the organic baby food and formula company's access to the important Chinese market.
Bellamy's is still working towards accreditation which would allow it to export Chinese-labelled products directly to China.
"It could be just coincidence, but I don't think it would be a good precedent if the Chinese government makes a decision which impacts negatively against an Australian company, then a Chinese company comes in and buys them out," Greens Tasmanian Senator Peter Whish-Wilson said.
He said it would potentially look like market manipulation if a Chinese company bought Bellamy's "in a weakened state" while it was waiting for the Chinese accreditation decision, then accreditation was granted, leading to a rebound in the value of the company.
"It would warrant a closer investigation," Senator Whish-Wilson said.
He said he would bring his concerns to Mr Frydenberg's attention.
The government could potentially block the deal, which would be subject to Foreign Investment Review Board scrutiny.
Bellamy's chief executive Andrew Cohen suggested China Mengniu Dairy Company Limited's takeover bid for Bellamy's could lead to a bigger Australian organic dairy and food industry.
Mr Cohen said China Mengniu Dairy Company Limited was a preeminent dairy company in China and an ideal partner for the Bellamy's business.
"It offers a strong platform for distribution and success in China, and a foundation for growth in the organic dairy and food industry in Australia," Mr Cohen said.
"Our employees, our trade partners and local organic manufacturers will continue to grow and thrive with the success of our business."
China Mengniu Dairy Company Limited chief executive Jeffrey, Minfang Lu said: "Bellamy's is a leading Australian brand with a proud Tasmanian heritage and track record of supplying high quality organic products to Australian mums and dads."
"This leading organic brand position and Bellamy's local operation and supply chain are critical to Mengniu."
Mengniu aims to acquire 100 per cent of Bellamy's shares via a scheme of arrangement.
It intends shareholders to get $12.65 in cash per share plus a 60c per share special dividend, the latter to be paid by Bellamy's before scheme implementation.
Bellamy's directors have unanimously recommended shareholders vote in favour of the deal, in the absence of a superior proposal and pending an independent expert concluding the scheme is in shareholders' best interests.
The offer was at a 59 per cent premium to Bellamy's share price of $8.32 at the close of trading on Friday and a 54 per cent premium to the three-month average share price to September 13.
Mengniu aims for implementation of the scheme by the end of 2019.
Launceston-headquartered Bellamy's employs about 160 people in Australia, China and Singapore and produces, supplies and markets organic food and infant formula for babies and toddlers.
It distributes products in Australia, China, Vietnam, Malaysia and New Zealand, and through online channels.
Hong Kong-listed Mengniu has market capitalisation of about $24.6 billion and is 69 per cent owned by public investors.
If the deal went ahead, Bellamy's would become a wholly owned subsidiary of Mengniu.
Bellamy's share price had shot up by more than 54 per cent to $12.87 by 12.30pm on Monday in the wake of the bid being announced.