Arla Foods and DMK Group have announced their intention to merge, forming what would become Europe’s largest dairy cooperative.
The merger between Arla and Germany's largest co-op, which would carry the Arla name, would unite more than 12,000 farmers under one cooperative.
According to the organisations, the proposed merger would also generate a combined pro forma revenue of €19 billion.
The move remains subject to approval by both cooperatives’ Boards of Representatives and regulatory authorities.
Denmark-based Arla and DMK have collaborated in the past, including their joint venture ArNoCo.
This processes whey from DMK’s cheese production into premium whey protein concentrate and lactose for Arla’s global ingredients business.
Peder Tuborgh, CEO of Arla Foods, said was a "very attractive partner that shares our core values".
"Our strong market positions and product portfolios complement each other very well and our strong partnership in recent years has proven that DMK Group is an ideal partner for Arla.
"Our joint market presence in Europe and globally will enable us to safeguard our production of healthy dairy products, ensuring stable food production in Europe.
"This merger is a natural continuation of our strong collaboration to the benefit of consumers, our farmers and their milk price."
Ingo Müller, CEO of DMK Group, added that Arla had established itself as "a key player" in the dairy industry.
He said: "Through Arla’s global reach we can access consumers and customers beyond our current geographical reach as well as strengthening our business resilience.
"Our complementary strengths, both in business and mindset, will enable us to keep advancing in dairy technology and innovation, while also providing a strong home for farmers.”
