Arla Foods and DMK Group have announced their intention to merge, creating the strongest dairy cooperative in Europe.
The merger would bring together more than 12,000 farmers and the companies aim to become one joint cooperative that will achieve a combined pro forma revenue of €19 billion.
“The foundation of this partnership is formed by our shared values, and I am immensely proud of this proposed merger, which is a win-win for our cooperatives,” Jan Toft Nørgaard, chair of Arla Foods, said.
“The strength of both Arla and DMK Group lies in our shared commitment to quality and innovation, and I see DMK Group as the perfect partner in shaping a new and strengthened Arla, poised to lead in the dairy industry."
Heinz Korte, chair of DMK Group, added: “We are proud of the planned merger with Arla, a cooperative that shares our commitment to innovation and optimal value creation. This partnership strengthens the resilience of our cooperatives and significantly contributes to strengthening the competitiveness of our farmers. Together, we can expand our reach for our dairy products, thus improving our offering and jointly driving the further development of innovative products for the benefit of our members.”
The merger represents a union of shared values and complementary strengths, creating the largest dairy cooperative in Europe. The joint cooperative will have a solid supply of milk in the coming years, ensuring the financial abilities to invest in the future of dairy.
“DMK Group is the largest dairy cooperative in Germany and a very attractive partner that shares our core values,” Peder Tuborgh, chief executive of Arla Foods, said.
“Our strong market positions and product portfolios complement each other very well and our strong partnership in recent years has proven that DMK Group is an ideal partner for Arla. Our joint market presence in Europe and globally will enable us to safeguard our production of healthy dairy products, ensuring stable food production in Europe, as well as bringing even more nutritious products to the world and our customers.”
Arla Foods and DMK Group have successfully cooperated on several projects in recent years, among others the joint venture project ArNoCo, which processes whey from DMK's cheese production into high-quality whey protein concentrate and lactose for Arla's global ingredients business.
“Arla has established itself as a key player in the dairy industry, and by partnering up we will have a strong and attractive branded and private label product portfolio for all our customers,” Ingo Müller, DMK Group chief executive, said.
“Through Arla’s global reach we can access consumers and customers beyond our current geographical reach as well as strengthening our business resilience. Our complementary strengths, both in business and mindset, will enable us to keep advancing in dairy technology and innovation, while also providing a strong home for farmers.”
The merged entity will carry the Arla name. Headquarters will be placed in Viby J in Denmark and Jan Toft Nørgaard will be chair. Peder Tuborgh will be CEO, and Ingo Müller will step into the Arla executive management team as EVP of post-merger integration.
The merger is subject to approval from the Board of Representatives in the cooperatives as well as regulatory approval.
