Arla Foods and EGM Walhorn to Merge
Dairy co-operatives Eupener Genossenschaftsmolkerei Walhorn (EGM Walhorn) and Arla Foods amba are to merge. The boards of directors have circulated a proposal to their members and the boards of representatives of both companies are expected to vote on the proposal in mid May.
Both dairy co-operatives are owned by farmers across different countries. Arla Foods amba has approximately 12,600 co-operative farmer members in Sweden, Denmark, Germany, Belgium, Luxembourg and the UK. The approximately 800 members of EGM Walhorn are located in Belgium, Germany, and the Netherlands. The dairy operations belonging to the EGM produce a total of around 550 million kilograms of milk per year.
Arla is the world’s sixth largest dairy company and has ambitious growth plans, both within the EU and in strategic growth markets outside of the EU. In 2013, Arla processed a total of 12.7 billion kilos of milk.
“This proposed merger will allow Arla to pursue its growth plans together with EGM Walhorn. We are confident that EGM Walhorn is the right business with which to deliver our plans. The Walhorn production site complements our production sites in Pronsfeld, in Germany, and Nijkerk, in the Netherlands. In addition, EGM Walhorn would provide us with an opportunity to grow our milk pool across Europe and the merger would be an important step towards achieving our strategic ambitions, which are focused on growth,” explains Ake Hantoft, chairman of Arla Foods.
The merger with Arla would result in EGM Walhorn members being given an unlimited milk purchase guarantee at a price calculated on the same basis as all other Arla members.
“For our co-operative, the proposed merger offers clear prospects of secure growth and greater profitability,” says Mathieu Dobbelstein, chairman of EGM Walhorn. “In Arla, we would have a strong partner, strengthening our co-operative orientation and offering farmers a secure basis for future development.”
