Arla merger cancelled as CEO resigns

(AFP) A merger between Danish-Swedish group Arla Foods, Europe's leading dairy company in terms of volume, and Dutch group Campina, has been called off, Arla announced on Thursday.

The merger, which was announced in December, would have created one of the world’s largest cooperative dairy groups. The two groups were however not able to agree on Campina’s real capital value, Arla said. The boards of both companies concluded that definitive merger proposals cannot be put to the members’s councils of the two cooperatives.

The merged group would have had a turnover of about 10 billion euros (13.3 billion dollars), employ some 28,000 people and be owned by about 21,000 member-farmers, Arla said at the time of the merger announcement in December.

Meanwhile, Åke Modig has announced his resignation as CEO of Arla Foods. The Swede has been with the company for thirty years.

“We respect Mr. Modig’s constructive contributions to our merger talks. One of the initiators of the envisaged merger is now leaving. Also because of this, there is no basis for further discussions at the moment,” the CEO of Campina, Justinus Sanders said.


Arla looks to milk UK, German dairy mergers

Swedish-Danish dairy cooperative Arla announced Tuesday it was planning two large European mergers, with Germany's Milch-Union Hocheifel (MUH) and Britain's Milk Link, both cooperatives.

Arla looks to milk UK, German dairy mergers

“Arla Foods is today announcing plans for two major mergers – with Germany’s eighth largest dairy, the cooperative Milch-Union Hocheifel … and with the UK’s fourth largest dairy, the cooperative Milk Link,” Arla said in a statement.

The three cooperatives are set to make a final decision on the mergers on June 26, but the deals will also need clearance from regulatory authorities, it added.

Arla, which will retain its name, said the mergers would allow it to grow from having 8,024 co-op owners in Denmark, Sweden and Germany, to having 12,300 owners in those three countries and also in Britain, Belgium and Luxembourg.

Arla, which raked in 55 billion Danish kroner ($9.4 billion) in sales in 2011, said that if the mergers go through they will “immediately increase Arla’s revenue by 9.0 billion kroner per year.”

The Scandinavian company, which exports products under the brands Arla, Lurpak and Castello to more than 100 countries and which employs more than 17,000 people, said that by 2015 it aimed to “be the UK’s largest dairy company and (to) rank third in Germany.”