It fulfils both co-operatives’ strategic priorities and will support their overall goal of providing their dairy farmer owners with a sustainable future.
According to the companies, 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 £2bn.
The merger will mean that Milk Link Members will become part of one of Europe’s leading dairy co-operatives. It is expected to provide the basis for improved returns for Milk Link members and enable them to achieve, after a transitional period, the same level of return as existing Arla owners.
The proposal will be subject to approval by Milk Link Members, the Arla Foods amba Board of representatives and relevant regulatory authorities.
The proposed merger builds on the strong and mutually beneficial working relationship that already exists between the two parties. This includes a joint venture in Westbury Dairies Ltd, shared facilities at Lockerbie and Milk Link supplying raw milk to Arla.
This merger will build on Arla’s ambition to invest in and grow the UK dairy market and enter new categories. Arla Foods amba has invested more than £500m in the UK dairy industry where it has established some of the country’s dairy brands including Cravendale, Lurpak and Anchor.
Peter Lauritzen, chief executive of Arla Foods UK, said: “Arla has a strong record of investing in facilities and brands in the UK. Together we will be able to offer British retail and foodservice customers with a full range of high quality dairy products from a single, secure, source, making us an even more attractive partner for British retailers.
“As such, the merger will be good for our farmers, our customers and their consumers and, ultimately, the British dairy industry.”
Source: Milk Link
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