Arla and Milk Link announce planned merger

The merger will create the largest player in the UK dairy market, which will have a combined turnover in excess of £2bn.

It will process more than three billion litres of milk per year, which is around 24 per cent of total UK production.

In a statement issued today, the boards of Arla Foods and Milk Link confirmed the proposed merger of the two dairy co-operatives.

The statement added: “It fulfils both co-operatives’ strategic priorities and will support their overall goal of providing their dairy farmer owners with a sustainable future.

“The merger will bring together two successful and growth orientated farmer-owned dairy processing businesses with complementary positions in key markets, brands and customer bases.

“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 enjoyed by existing Arla owners.”

The proposal will be subject to approval by Milk Link Members, the Arla Foods board of representatives and the relevant regulatory authorities.

Peter Lauritzen, the chief executive of Arla Foods UK, said: “The enlarged business will be focused on delivering a sustainable future for our farmer owners.

“It will mean that the largest and most progressive dairy business in the UK will be owned by Milk Link and Arla Foods farmers, as well as by Arla Foods Milk Partnership members, through their shareholding in Arla Foods UK, via their investment company, MPL.

“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.”