Danone and Unimilk join forces in Russia

Danone and Unimilk have agreed to merge Danone’s fresh dairy product businesses in the CIS area with those of Russian company Unimilk. Spanning operations in Russia, Ukraine, Kazakhstan and Belarus, the merger covers all dairy products. It will make Danone-Unimilk the leader for dairy products in the CIS area as a whole, particularly in Russia, where it will account for around 21% of the total market and hold strong positions in high-value, high-growth segments, according to the company.
The new entity will generate annual sales of approximately EUR1.5 billion and count over 18,000 employees. It will be chaired by Andrey Beskhmelnitsky, current CEO of Unimilk, while Filip Kegels, current general manager of Danone Fresh Dairy Products in Eastern Europe and Central Asia, will take charge of operational management.
The tie-up is beneficial to both, notes Danone, as the two firms have a complementary geographical presence, with Danone operating mainly in western Russia, while Unimilk has a higher profile to the east. Danone will control 57.5% interest in the new entity, while the current shareholders of Unimilk will hold 42.5%.