The agreement will go to the co-ops members in June

The agreement will go to the co-ops' members in June

French dairy co-operative Valcrest has signed a letter of intent to merge its production and commercial activities with larger peer Eurial.

The agreement is subject to the approval of the two co-operatives' general assemblies, which will convene in June, as well as their works councils.

Valcrest has a strong presence in goat's cheese and other speciality cheeses. It has three production sites and a turnover of close to EUR50m (US$69m).

"Through this merger plan, Eurial and Valcrest can re-inforce their position in added value goat's cheeses as well as regional specialty cheeses made from cow's milk," a joint statement reads.

Valcrest will benefit from Eurial's commercial network and gain access to a wider market for its products. For Eurial, the tie-up will offer new supply options for goat's milk where it has recently experienced difficulties.