UK dairy giants join forces

The creation of a £1bn (€1.4bn) dairy giant was in the pipeline today after two farming co-operatives announced plans to join forces.

Glasgow dairy business First Milk and Bristol-based Milk Link have said they are in “advanced discussions” over a possible merger to take on overseas rivals, including in the cheese market.

The combined group would be jointly owned by 4,250 dairy farmers – handling nearly three billion litres of milk every year – if the deal is approved by competition authorities.

The two businesses supply milk to dairy processors such as Dairy Crest and Robert Wiseman, as well as own-label cheese to a host of supermarkets including Asda, Morrisons, Sainsbury’s and Waitrose.

They also hope to tackle competition from overseas co-operatives such as Danish group Arla and New Zealand’s Fonterra through the tie-up.

The two firms said: “Both organisations believe that coming together presents a foundation to create a world class, British farmer-owned dairy business with the scale, expertise and ambition to compete with global players.”