Sodiaal and 3A to merge in France

France’s dairy cooperatives Sodiaal and 3A have agreed to merge to form a group with €5 billionin sales as the sector braces for increased competition when European production quotas come to an end, news agency Reuters reports. Sodiaal is France’s largest dairy cooperative with 4.1 billion litres of milk handled last year. It will join with smaller co-op A3 in a deal that could be completed by the end of the year, both parties say.

Sodiaal plans to close three plants operated by its milk brand Candia in France to boost profitability in a segment that offers lower margins than cheese or yogurt. Other interests include a 49% stake in yogurt maker Yoplait.