Today
Apr 21, 2015, 4:41 pm
Sunny
12°C


DKK100 - €13.40 - $14.35
Today
Apr 21, 2015, 4:40 pm

Arla plans huge merger

Dairy giant looks to milk UK and German markets

Two airlines are opening new routes at Kastrup (Photo: Terry Whalebone)
May 23rd, 2012 11:27 am| by admin
facebooktwittergoogle_pluspinterestmail

The Danish-Swedish dairy cooperative Arla Foods announced in a statement that it is planning two mergers. If approved, Arla plans to engulf Milch-Union Hocheifel, Germany's eighth-largest dairy, and Milk Link, the fourth-largest dairy in Britain. The mergers would increase Arla's annual revenue by nine billion kroner.

“Each of these three companies seek to create value for shareholders in the form of strong milk prices,” Peder Tuborgh, Arla’s chief executive, said in a statement. “If these plans are realised, our futures and ability to deliver results will be strengthened.”

The mergers would make Arla the UK's largest dairy company and the third largest in Germany. The amount of milk handled by the company will increase from nine to 12 billion kilos.

“The strength and value of a co-operative dairy becoming one of the world’s leading dairy companies can not be underestimated,” said Arla chairman Åke Hantoft.

Arla and its acquisition targets are co-operatives, so any mergers must be approved by shareholders at all three companies. A vote on the mergers is expected to take place on June 26.

Arla's 150 board members from Sweden, Denmark and Germany were informed about the merger plans on Monday.

“I dare not predict how the shareholders will vote,” Hantoft told the Swedish news agency TT. “I respect the democratic process. It's not only up to us to decide, the other companies must agree.”

Hantoft said that since the other companies involved will essentially be swallowed up by Arla, getting shareholders to agree may take a bit of work.

If the companies manage to convince shareholders that the mergers should go through, the deal would still need regulatory approval.

If the mergers happen, Arla will gain its first co-op members in Britain, Belgium and Luxembourg. The company’s German holdings will also be significantly expanded.

Arla currently has 8,024 shareholders. That figure would increase to about 12,000 after the mergers.

Maersk Line’s containerships have already picked up 750 boat refugees since the beginning of the year (photo: iStock)
Maersk boss: Mediterranean refugee situation is a tragedy without equal
There are a million refugees ready to cross the Mediterranean from Africa t...
Child care workers are trapping online paedophiles (photo: Cheon Fong Liew)
Nine Danes caught in paedophile sting
Nine Danish men have allegedly tried to watch webcam sex shows featuring ch...
Blue lobsters are quite rare (photo: H.Zell)
Rare blue lobster turns up at Hornbæk fish house
When a rare blue lobster turned up at the fish auction in Gilleleje, the ow...
Older students said that classrooms are rarely quiet (photo: Mosborne)
First comprehensive look at public school satisfaction reveals challenges
A national study of the state of public schools by the Education Ministry, ...
What's that: Harry Potter? Study claims 52 percent of Danes are atheists or non-believers (photo: Pixabay)
Denmark still predominantly non-religious, says expert
The results of a recent survey by Gallup International on world religion ar...
Greater Copenhagen name has been a sticking point for some (photo: iStock)
Swedish politicians back plans for a ‘Greater Copenhagen’ and Øresund parliament
The Øresund region should have its own parliament, and it’s not out of t...