French dairy groups Sodiaal and Entremont Alliance have decided to merge a number of their operations in the face of reform of the EU dairy sector.

Sodiaal told just-food today (24 July) that the companies would integrate operations producing baby food formulas, elaborated milk ingredients and nutritional and dietetic products.

The companies' sites in Doullens in the north of France and Montauban, in the south-west of the country, will be the production units for the venture.

Sodiaal and Entremont Alliance are already partners in the production of milk fats and butter but said this new tie-up would help them face the challenges thrown up by recent reform of the EU dairy sector.

Last month, the EU decided to scrap restitutions on dairy exports, a move that has led to the end of subsidies on the shipments of dairy products.

The move will see refunds on the exports of butter and cheese from the EU abolished. This follows similar moves on skimmed milk powder, whole milk powder and condensed milk in the last year.

Last month, Sodiaal also set up a cheese joint venture with fellow French dairy group Bongrain.