UK dairy co-operative Dairy Farmers of Britain has fallen into administration, receivers at PricewaterhouseCoopers have confirmed.
PwC was called after the co-operative’s moves to revamp the business failed to stem losses. The move leaves the future of the co-operative’s 2,200 staff and 1,800 farmer members up in the air.
Stephen Oldfield, a joint receiver and partner at PwC, said: “Dairy Farmers of Britain has experienced very challenging trading conditions in its liquids business.
“Efforts to sell the liquids businesses continue, but the DFB board were unable to identify a viable way forward given the trading losses and the inability to pay an economic milk price. They were left with no option than to invite the appointment of receivers.”
The closure of two dairies and last month’s sale of dairy ingredients business Nene Valley Foods was not enough to arrest the decline of the business.
Fierce competition led DFB to cut the price it pays to its suppliers and was a factor in the loss of a key contract to supply UK retailer The Co-operative Group. The co-operative is responsible for 10% of the UK’s liquid milk production.
DFB chairman Lord Grantchester said the group’s board had worked “tirelessly to restructure the business”. However, he added: “Clearly, the decision to invite receivers is not an easy one, but the board was unfortunately left with no alternative.”
