Arla Foods, Claymore Dairies and North Milk Coop have today reached an agreement whereby Arla and North Milk Coop will sell Claymore Dairies to a management buyout team based at the Nairn facility, for an undisclosed sum, with effect from 1 February 2010.
As part of the agreement, it is proposed that Arla will transfer some of the retail milk volume from Claymore to Lockerbie and will open a distribution hub in Dundee to service its retail customers that are based in the Highlands. Subject to the consultation, approximately 65 positions will become redundant at Nairn dairy, although new roles will be created at both Dundee and Lockerbie.
North Milk Coop has been offered a milk supply agreement in which Arla Foods and Claymore Dairies will purchase its milk.
Commenting on his decision to lead the MBO, Ian Larg, Operations Director at Nairn dairy, said: “We are delighted to have been given the opportunity to purchase the rest of the Claymore Dairies business as we believe that there is a strong appeal in the area for locally produced and processed milk. Our proposals, which include the setting up of a new company, will secure many of the jobs at the dairy and also the future of the site.”
Lars Dalsgaard, Business Group Director, Supply Chain at Arla Foods, said: “The viability of the site has been under review for some time. The site’s management team approached us about the possibility of them leading a management buyout of part of the business from Arla. After considering the team’s proposal, we came to the conclusion that an MBO was the best solution for all parties. Unfortunately, subject to the consultation process, the decision could lead to a number of redundancies but we believe that the buyout will secure the future of the site and the remaining jobs.
“We will be working with the buyout team to support them in every way we can during the transition to ensure the success of their new business.”
Martin Bridges, Chairman of North Milk Coop, comments: “The Coop has witnessed a substantial exodus of members which has resulted in a reduction in raw milk volume over a number of years. We are delighted that, as a result of the management buyout the processing of local milk in the area would be secured and would offer the members of North Milk Coop the much needed security of a milk supply contract.”
Arla Foods UK plc is home to some of the UK’s leading dairy brands including Cravendale, Lurpak and Anchor. Processing approximately two billion litres of milk a year Arla continues to be one of the UK’s leading dairy companies and a supplier of fresh liquid milk and cream to the top seven retailers.
Over 2,500 daily deliveries are made directly to stores nationwide and Arla brands can be found across the dairy category. As well as the leader of the butter, spreads and margarine sector, and a major supplier of other added value products including flavoured milk and cheese, Arla continues to build working relationships with Arla Foods Milk Partnership, a unique group of dairy farmers, which supplies around 90 per cent of Arla's total milk requirements.
Behind this leading business is a team of circa 2,800 people across the UK located at our dairies, distribution centres and head office.