Jens Bigum, Arla Foods Group Managing Director
Fonterra and Arla Foods, two of the world’s largest dairy co-operatives, announced today plans to join forces in their yellow fats operations in the UK.
The joint venture will, subject to regulatory approval, commence operations in early 2002.
The new company will be responsible for the marketing and distribution of the existing Lurpak and Anchor brands, as well as developing new products in the highly competitive yellow fats market.
Details of the structure and the management team will be decided towards the end of this year. However, it has been decided that the new company would utilise the larger Arla Foods structure based in Leeds and to close the base in Swindon at the end of 2002. Staff there are being consulted.
Jens Bigum, Arla Foods’ Group Managing Director said:
“The new venture follows naturally from Arla Foods’ new strategy plan which envisages such partnerships. The move will enable both parties to exploit their production facilities better and thus enhance our services to the large multiples and consumers. We’re pleased to note that Fonterra has decided that Arla Foods is the best partner among all the many excellent dairy companies in Europe.”
Fonterra CEO Craig Norgate said:
“Just as we are seeing elsewhere in the world, UK retailers are becoming more powerful, leading suppliers to consolidate to become more efficient and to have the reach necessary to service larger customers. In a market where we forecast continued decline in demand, we need all the scale we can get and every ounce of efficiency”.
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