Cross-border co-operative merger proceeds

The merger between the German dairy group Milchwerke Køln/Wupperthal (MKW) and Europe’s fourth largest dairy company, the Dutch Campina Melkunie, moved one step further this week when MKW’s Board of Representatives approved the merger at a meeting in Cologne.

The merger is scheduled to become effective on January 1, 2001 with Campina Melkunie as the continuing company. The final go-ahead, however, is dependent upon the approval of Campina Melkunie’s Board of Representatives. The Campina Melkunie Board of Representatives are expected to make their decision at the end of December.
The new Campina Melkunie group will be owned by 12,000 co-operative owners - 8,500 from Holland and 3,500 from MKW. The volume of milk received, however, will remain unchanged at 5.2 billion because 750 million kg from the German owners will be supplied exclusively to the joint German company Tuffi Campina Emzett.
“Following the merger, as a German-Dutch company, our position in Germany will be greatly strengthened. One of the objectives of the merger is to create a broader capital base which will help finance our international growth,” said Campina Melkunie’s Group’s Head of Information Jeen Akkerman to Arla Foods.
The German-Dutch merger will take place in three stages. Initially, MKW will become an “extraordinary” member of Campina Melkunie for a period of up to five years. Subsequently, the German co-operative owners of MKW will become co-operative owners of Campina Melkunie for a maximum period of two years during which the milk price may vary between the two countries. The aim is to apply common conditions and a common milk price before January 1, 2007.
Campina Melkunie, which has an annual turnover of approx. USD 3 billion, has 6,900 employees.
Campina Melkunie entered the Danish market in August as a supplier of double cream to the FDB chain. The group is a major producer of Gouda cheese in the European market.