Arla Campina merger plans fail

PLANS TO create the world‘s largest dairy co-operative by merging Denmark‘s Arla Foods with the Netherlands‘ Campina have fallen through.

Talks reached the final stage before directors of the two co-ops concluded it was not possible to present a joint merger proposal.

Reports claimed the merger was derailed by demands for billions of euros of compensation for shareholders of Arla, the larger co-op.

Arla‘s managing director, Åke Modig, has agreed to resign once a successor is found.

The deal announced in Dec would have created a company worth €10bn (£7bn) employing more than 28,000 people.

Neither side of the failed merger would explain what went wrong, but claimed relations between the companies were good.

“We have enormous respect for Campina and regret that we could not reach a satisfactory result this time around,” said Arla Foods‘ Chairman Knud Erik Jensen.

“We will part as friends and it could well be that we continue our dialogue at some future stage.”

Both companies insisted the break down of talks would not affect business.

Justinus Sanders, chief executive officer of Campina, said: “Although we regret the fact that the merger had to be called off, we are convinced that Campina has enough opportunities and strength to continue its successful course of international growth, innovation and efficiency.”