This means that conditions are now in place for maintaining milk production in a large area of Sweden.
The Swedish Competition Authority has stipulated, however, that Arla must sell certain Milko brands and the Milko dairy at Grådö in Dalarna (the Dalcarlia region).
Director of Arla’s Swedish market, Christer Åberg, said: “We are very pleased that milk production can now be maintained in a large area of Sweden. Arla will comply with the Swedish Competition Authorities’ stipulations. Via the merger, Arla will have access to more milk and will be in a position to continue to develop the Swedish dairy market for the benefit of employees, dairy farmers and consumers alike.”
The basic principle of the merger is that Milko members will become members and owners in Arla Foods under the same conditions as existing Arla members. From the official merger date, November 1, the Milko farmers will receive the Arla milk price, and Arla will collect milk from every farmer who has applied to join Arla.
Milko’s chairman, Lars Reyier, said: “This represents a crucial boost to the finances of many Milko farms. And we, the Board, are pleased to have succeeded in ensuring that all the Milko farmers have been offered the chance to continue to produce milk, even though Milko will now cease to exist as an independent association.”
Arla accepts the conditions for the merger as stipulated by the Swedish Competition Authority. The authority has determined that Arla must sell the Milko dairy at Grådö in Dalarna (the Dalcarlia region). Through the sale, Arla will reduce capacity at the dairy from the current 120 million kilos of fresh dairy products a year to 50 million kilos, which will also effect the employees at the dairy in Grådö. Within six months, Arla must also sell the Milko trademarks Bollnäsfil, Tiger, Bärry, Fjällfil and Fjällyogurt to a third party.
The task of integrating Milko into Arla will now progress in stages when the Milko farmers and employees become Arla members and employees respectively. Arla calculates that, in the wake of co-determination talks, they will be in a position to present the new organisation and manning by the end of November.
Source: Arla Foods
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