Milk Link quits mega-co-op talks
2 February 2001
Milk Link quits mega-co-op talks
By Robert Harris
MILK Link has pulled out of talks aimed at creating a new national milk supply co-operative for thousands of dairy farmers.
The southern-based co-op was in talks with its northern counterpart Zenith, the Express Milk Partnership and Dairy Crest suppliers.
Both Express Dairies and Dairy Crest themselves were also involved.
The businesses had been exploring ways of establishing a co-op with up to 9000 farmer members supplying 4.5 billion litres of milk.
But, with almost a third of the UKs raw milk at stake, there was a concern that competition authorities were going to take a keen interest.
Last week, Milk Links operations director Neil MacFarlane said the talks aimed to “see what might work before we see the regulator”.
But lawyers seemed to think that nothing would work, leaving Milk Link with to announce its withdrawal on Friday (02 February).
The other potential partners still believe the plan can work, says Richard Smith, chairman of Express Milk Partnership.
“We are obviously disappointed that Milk Link has pulled out.
“No-one underestimates the (competition) problem. But with two major processors on board, we believe it is still a runner.”
Milk Link also announced it would boost its financial muscle to allow it to move into processing through joint ventures, partnerships or direct investment.
“An amended constitution will allow capital to be raised from a variety of sources and retained within the business,” said chairman Jeremy Pope.
The co-operative now plans to give farmers more control over the business by revamping its management structure.
A supervisory board of farmer directors will oversee a professional executive management team which will work on strategy and investment.
Chief executive Barry Nicholls said moving towards a European-style co-operative would create greater flexibility to develop the business.
“The concept will be entirely new to the UK,” he said.