MUH and Arla merger approved in EU

The merger between German Milch-Union Hocheifel (MUH) and Arla Foods has been approved by the EU competition authorities. The merger occurs on 1 October 2012. Arla’s executive vice president and director of the company’s operations in Germany, Tim Ørting Jørgensen, states: ”This is a big day in the company history of both Arla and MUH. This merger will provide Arla with new opportunities on the German market not only in terms of an increased supply of raw milk and access to a strong product portfolio, but it also creates a platform for increased export to growth markets like China. We are prepared to begin the integration process and look forward to generating the greatest possible value from the new joint business.”

MUH is Germany’s eigth-largest dairy company, specialising in production of so-called long life milk (milk with extended shelf life) and fresh liquid milk in the town of Pronsfeld, southwest of Cologne near the border of Belgium and Luxembourg. MUH employs approximately 800 people and has approximately 2700 cooperative owners who – like Arla’s owners – are dairy farmers. In 2011 the company generated a revenue of approximately 680 million Euro, of which approximately 40 per cent came from exports.

Arla has a long history in Germany with well-known brands including Arla Buko and Arla Kærgården, both of which are delivering rapid growth. The merger between MUH and Arla creates the third-largest dairy company in Germany, which will be called Arla Foods Deutschland.