Green light for Arla and DMK merger

The European Commission has approved the merger between Arla, DMK and DOC Cheese without conditions. This allows the dairy cooperatives to merge into Europe's largest dairy cooperative, with combined revenue of around €20 billion and about 11,200 member dairy farmers. The integration process starts next month. After an extensive competition investigation, the European Commission concludes that sufficient competition will remain after the merger. The review looked at milk procurement in Germany and the sale of dairy products and whey ingredients in, among other places, Denmark, Finland, Germany, the Netherlands and Sweden. Enough competition remains Particularly in northern Germany, attention was given to the position of dairy farmers. The Commission concludes that Arla, because of its cooperative structure and the system in which all members receive the same milk price, has little room to put local pressure on milk prices. In addition, dairy farmers could switch to other cooperatives if there is a need for that. Brussels also expects no problems in private-label dairy, because retailers work with multiple suppliers and regularly issue tenders. In the market for whey ingredients, the Commission also says there will remain sufficient alternative suppliers active. Continuing together as Arla In a joint statement, both parties say they will continue under the name Arla, with headquarters in Denmark. Based on revenue and size, Arla is considered the leading party within the new organization. According to the cooperatives involved, the merger should lead to better value creation from milk and thus to a higher milk price for members. In addition, both parties expect to be stronger in the areas of innovation and investment in production capacity. Together we will grow into one of the most future-proof dairy producers in Europe, said Arla CEO Peder Tuborgh. The boards of the cooperatives involved describe it as a historic step. From June About one year is being set aside for the integration. The merger plans were announced in April last year and later approved by a large majority of the members' councils of the cooperatives involved.