Arla Foods, DMK Group announce merger to form Europe’s largest dairy cooperative

DENMARK – Arla Foods, a leading Danish-Swedish dairy cooperative, and Germany’s DMK Group have unveiled plans to merge, creating what is set to become Europe’s largest dairy cooperative. 

The announcement marks a significant consolidation in the dairy sector, bringing together over 12,000 farmers across seven countries with a combined revenue of approximately US$20 billion.

The merger aims to strengthen the competitive position of both cooperatives in a challenging global market. 

Arla Foods, known for brands like Lurpak and Cravendale, employs around 21,900 people and operates in countries including Denmark, Sweden, and the UK.

DMK Group, headquartered in Zeven, Germany, has about 6,800 employees and is a major player in the German dairy industry. 

According to a joint statement, the merger will enhance production capabilities and ensure a stable milk price for farmers while expanding their reach to consumers worldwide.

“This partnership is a natural step forward, built on years of collaboration,” said Peder Tuborgh, CEO of Arla Foods. “Together, we can safeguard healthy dairy production and deliver more nutritious products to customers globally.” 

The two companies have a history of working together, notably through their joint venture ArNoCo, which processes whey from DMK’s cheese production into high-quality ingredients for Arla’s global business.

The merged entity will operate under the Arla name, with its headquarters remaining in Denmark.

Jan Toft Nørgaard, current chair of Arla Foods, will lead the new cooperative, while DMK’s CEO Ingo Müller will join the executive team to oversee integration. 

“This merger strengthens our resilience and competitiveness, benefiting our farmers and consumers alike,” Müller stated. 

The deal, however, awaits approval from both cooperatives’ boards and regulatory authorities, with a target completion by the end of 2025.

Meanwhile, the merger could help address declining milk volumes in Europe by diversifying product portfolios, which include both traditional dairy and plant-based options. 

Arla has recently ventured into alternative proteins, partnering with Novozymes to explore precision fermentation, while DMK’s MILRAM brand offers plant-based products. 

The combined expertise is expected to drive innovation and meet evolving consumer demands.

The announcement has sparked mixed reactions. Some industry observers see it as a strategic move to navigate rising costs and market uncertainties, while others express concerns about its impact on smaller producers.

As the dairy giants prepare for integration, the focus remains on delivering value to farmers and maintaining high-quality standards for consumers across Europe and beyond.