Arla Foods and DMK Group is to merge in a deal that will establish Europe’s largest dairy co-operative.
Subject to board and regulatory approval, the deal would create a €19bn co-operative sourcing milk from more than 12,000 farmers across Europe.
Germany’s largest dairy co-op, DMK (Deutsches Milchkontor), generated €5.1bn in revenue last year. Based in Lower Saxony, its brand portfolio spans milk, cheese, baby formula, and desserts, including Oldenburger, Milram, Uniekaas, Humana, and Osterland.
Described as a “union of shared values and complementary strengths,” the merger builds on past collaborations, including ArNoCo—a joint venture that processes whey from DMK’s cheese output into ingredients for Arla’s global business.
'The co-operatives have united farmers for many generations, and the merged entity will shape the future of dairy for generations to come,' they added. 'The combined entity will stand commercially strong and gain increased resilience through more diversified product portfolios and market positions despite the anticipated decline in the overall European milk pool.'
As Europe's largest dairy co-operative, it was the pair's 'clear ambition to develop even stronger partnerships with customers, adding value to their business, while also offering an attractive environment for farmers, colleagues and other business partners', they said.
'The joint co-operative will have a solid supply of milk in the coming years, ensuring the financial abilities to invest in the future of dairy.'
The planned merger is a “win-win for our co-operatives,” according to Arla Foods chair Jan Toft Nørgaard.
“Our shared commitment to quality and innovation” is what unites Arla and DMK Group, he added, noting that he sees DMK as “the perfect partner in shaping a new and strengthened Arla, poised to lead in the dairy industry.”
'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. This merger is a natural continuation of our strong collaboration to the benefit of consumers, our farmers and their milk price.'
The combined business will retain the Arla name and be based in Viby J, Denmark. Nørgaard will stay on as chair, Tuborgh as CEO, and DMK’s Ingo Müller will join the executive team as EVP overseeing post-merger integration.
