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Arla merger imminent

If the mergers go through, Arla’s revenue will increase by DKK9billion.

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Arla Foods has announced plans to merge with two foreign cooperative dairies to make it Britain’s largest dairy producer and Germany’s third largest.

The two dairies concerned are the German dairy Milch-Union Hocheifel, which is Germany’s eighth largest and Britain’s Milk Link, which is the United Kingdom’s fourth largest.

“The Boards of Arla Foods amba and Milk Link have announced the proposed merger of the two dairy co-operatives. The proposal will result in the full merger of Milk Link, the UK’s leading dairy farmer co-operative, and Arla Foods amba, one of the largest and most successful European dairy co-operatives,” Milk Link says on its website.

“It will create the largest player in the UK dairy market, which will process over three billion litres of milk per annum and have a combined turnover in excess of £2 billion,” it adds.

The German dairy Milch-Union Hocheifel – or MUH - is also a cooperative, with some 2,600 members in Germany, Luxemburg and Belgium. Its headquarters are in Hocheifel region of Rhineland-Palatinate.

“If the members accept these mergers, it will cement Arla Foods’ position as one of Europe’s soundest dairy companies,” says Arla Foods CEO Peder Tuborgh.

“Both Milk Link and Milch-Union Hocheifel are strong, well-run dairy businesses. Their product portfolio and production lants will strengthen our businesses in Germany and Great Britain,” he adds.

The final decision on the merger will be taken on June 26 when member representatives of the three cooperatives will vote on the merger.

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