Åke Modig, managing director of Danish-Swedish dairy giant Arla Foods, has said the company intends to be part of future industry consolidation in Europe.
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Modig’s comments came after the planned merger between Germany’s two largest dairy companies, Humana Milchunione and Nordmilch was dropped due to current consolidation within Humana Milchunione and the extensive restructuring of Nordmilch.
Although the merger was cancelled, Modig said he is in no doubt that other major mergers within the European dairy sector are on the cards, prompted by the EU’s agricultural reform, which is putting pressure on milk prices.
”We can expect more mergers within Europe and we intend to be part of that process. However, it’s crucial for us to find an equivalent partner, where the farm gate price is on a par with ours,” Modig said.
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