Walhorn and Arla agree to merge

The merger between Arla Foods and EGM Walhorn has now been approved by the cooperative owners in both companies. The merger will add more dairy farmers to Arla in Belgium, Germany, and the Netherlands.

Owner-elected representatives from Arla and EGM Walhorn have agreed to the merger of the two cooperatives. The decision comes one and a half months after the two cooperatives’ board of directors presented a merger proposal which has since been debated in the two owner groups.

“We are delighted to welcome the new dairy farmers to our group of owners. Arla is a bigger business than Walhorn, but we have exactly the same desire to be part of a cooperative that enables us to grow and develop our farms. Some of Walhorn’s owners are already neighbours of Arla farmers, so in every way it feels like a natural step to merge with our colleagues at Walhorn,” says chairman of Arla Foods, Åke Hantoft.

Following the merger, Arla will have 13,500 cooperative members. For the first time, Arla will have members in the Netherlands, resulting in Arla having owners in seven different northern European countries.

Arla’s CEO Peder Tuborgh is also delighted to welcome the new members:

“We see this merger as a vote of confidence on the part of Walhorn’s dairy farmers and we are convinced that the merger will lead to a mutually beneficial partnership. At Arla, we have made a point in recent years of informing our members that they are the very core of Arla’s business foundation and that we are ready to buy all the milk they are able to produce – also when European milk quotas disappear. This message has been warmly received by Walhorn’s owners,” says Peder Tuborgh.

The merger will impact Arla’s access to raw milk in Germany and Belgium for the dairies in Pronsfeld, Germany and Nijkerk in the Netherlands.

The merger, which must now be approved by the national competition authorities, is expected to go ahead in the summer.

Number of votes
In both companies, voting went through the boards of representatives. A yes required a 75 per cent majority in both companies.

Arla yes votes: 174 votes (94 per cent)
Arla no votes: 11 votes (6 per cent)

Walhorn yes votes: 118 (94 per cent)
Walhorn no votes: 5 (6 per cent)
Two votes void.

Facts about Arla Foods
• A cooperative owned by 13,500 milk producers (incl. Walhorn’s 795 dairy farmers) in seven different countries: the UK, Sweden, Denmark, Germany, Belgium, Luxembourg and now also, as a result of the merger, the Netherlands.
• Arla’s core markets are the UK, Sweden, Germany, Denmark, Finland and the Netherlands.
• In 2013, Arla’s worldwide sales of dairy products to customers and consumers totalled DKK 73.6bn.

Facts about EGM Walhorn
• A cooperative owned by 795 dairy farmers in Belgium (426), Germany (317) and the Netherlands (52).
• The company has an annual turnover of EUR 239m.
• EGM Walhorn collects milk from its members and sells it to the dairy Walhorn AG, which EGM Walhorn jointly owns with the privately owned dairy company Lactalis.
• EGM Walhorn’s collaboration with the dairy will remain unchanged following the merger.