EU gives go-ahead for Arla and DMK dairy merger

Regulators have approved the proposed merger of two European dairy processors which will bring together more than 11,000 farmers under one co-operative.

Arla Foods, which is owned by 7,300 dairy producers across the UK and EU, will merge with the German DMK Group, which has almost 4,000 farmers.

The co-operative will continue to trade under the Arla name and will have an annual combined milk pool of 19.4bn kilograms and expected revenue of more than €20bn (£17.35bn).

See also: Dairy trade shows signs of optimism as spring peak passes

All farmers supplying the co-operative are expected to receive one pre-paid milk price.

A two-year transition period will begin on 1 June 2026, with DMK becoming a subsidiary of Arla and new members due to be added to Arla’s board of directors.

Arla chairman Jan Toft Nørgaard said: “We can move forward together to secure the necessary scale, long-term economic resilience and investment capability required to contribute to shaping a food sector with a reduced impact on climate and nature.

“Our co-operatives have united farmers for generations and collaboration across borders has never been more important to help feed life across the planet.”

Heinz Korte, the chairman of DMK Group, added: “We, the farmers, are looking forward to joining forces.

“We are building one of the largest communities of farmers in Europe, and from our local roots we can strengthen our global reach and further grow the value of our milk.”

The EU Commission unconditionally approved the merger on 28 May, following an investigation which concluded that the transaction would raise no competition concerns.

Arla has also confirmed it will continue to pay its UK producers 35.83p/litre for a standard manufacturing litre in June.