Muller is to exit a joint venture in the UK with New Zealand milk firm A2 Corp. that the German dairy giant took on when it snapped up local milk supplier Robert Wiseman Dairies last year.
A2 and Robert Wiseman Dairies set up A2 Milk (UK) in 2011 to push the New Zealand firm’s products, which are aimed at consumers who find it hard digest milk.
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A2 milk comes from cows that naturally produce the A2 type of beta-casein protein rather than the A1 protein, which can cause digestion problems.
Both firms had a 50% stake in the venture. In February 2012, Muller acquired Robert Wiseman Dairies. That summer, the A2 Milk (UK) venture launched its first products in the market.
Geoffrey Babidge, managing director of A2 Corp., said today (19 November) “recent events have created the opportunity to evolve the commercial relationship” with the now Muller Wiseman Dairies, the UK milk arm of the German dairy group.
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The New Zealand firm will acquire Muller Wiseman Dairies’ shares in A2 Milk (UK) for “a nominal amount”, it said.
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By GlobalDataThe company will take on the marketing and sales of A2 fresh milk products. Muller Wiseman Dairies will continue to procure, process and distribute A2 milk but on a cost-plus basis to A2 Corp. The changes will take effect in January.
“The change in structure will enable A2C to move in a more focused way on building sales of A2 fresh milk in the UK whilst leveraging the scale and operational capabilities of MWD. Initial consumer reaction to the A2 proposition has been favourable and confirms our view that a viable premium niche position can be created for A2 branded dairy products,” Babidge said.
A spokesperson for Muller Wiseman Dairies said the end of the venture was “just an evolution” from Muller’s takeover of Robert Wiseman Dairies and meant the company could now focus on its “strategic priorities”.
However, the spokesperson stressed little would change on a day-to-day basis. “We continue to pick up the milk from farmers and continue to pack, process and distribute the milk,” the spokesperson said. “We just now do the work for A2 Corp. on a cost-plus basis.”
