Dairy co-ops Arla Foods and Hansa-Milch Mecklenburg-Holstein eG have won the backing of their farmer-members for a merger between the two companies.
Arla said that the companies’ proposals, first announced in December, were given the green light by co-operative members yesterday (2 March). The transaction still requires the approval of competition authorities.
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German co-op Hansa-Milch will be renamed Hansa Arla Milch eG but will remain a co-operative entity with its own members, Arla said. The move would mean the German firm’s “democratic structures are still preserved”, the Danish company explained. Hansa Arla Milch will also have representatives on Arla’s board and committees.
However, under the terms of the deal, the Hansa-Milch co-op’s dairy business, Hansa-Milch AG, will switch to Arla.
Hansa Arla Milch’s farmers are also being given a “milk purchase guarantee” from Arla, which will also pay the German co-op’s members a milk payment price calculated on the same basis as its own Danish and Swedish members.
Uwe Krause, the co-operative’s chairman, said: “We are delighted at the majority vote by our members in favour of the merger with Arla. By this move, we are laying the foundation for successful growth and strengthening our market position.”
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