Americans buy UK organic dairy

1 June 2000

Americans buy UK organic dairy

A LEADING British organic milk processor and supplier has been bought by Americas largest organic dairy producer.

Devon-based Meadow Farms, which produces private label organic milk for supermarket chains, has been acquired by Horizon Organic for an undisclosed sum.

The purchase includes a processing and packaging plant.

Last year Horizon bought Aberystwyth-based Rachels Dairy in a multi-million pound deal and the Meadow Farms acquisition will strengthen its position in the UK.

Britain is attractive to the American company because the UK organic dairy market is growing faster than its US counterpart.

Horizon predicts that combined sales of Rachels, Meadow Farms private label business and Horizon Organic UK branded business will shortly represent nearly a quarter of its total revenues.

The American company also sees the UK as a platform for expansion into Europe.

Meadow Farms has 60%of total organic fluid milk sales in the UK, and during the past five years has enjoyed annual compounded growth of 50%.

Last year it had sales of 16 million.

Horizon says it will continue to supply private label products under Meadow Farms existing contracts, and seek to introduce its own branded milk in the UK.

The US company said the Meadow Farms acquisition complements its purchase of Rachels Dairy.

With a larger operating base, the company hopes to achieve lower costs due to economies of scale and increased market share.

“This acquisition will allow us to establish a strong presence for Horizon Organic branded products in the UK where consumer interest in organic food products is well established,” said Chuck Marcy, Horizon president and chief executive officer.

Jeremy Deacon, managing director of Horizon Organic Dairy will oversee the integration of Meadow Farms into Horizons UK operation.