Arla Foods and Germany’s DMK Group have received regulatory approval for their planned merger, clearing the final hurdle for the creation of one of Europe’s largest farmer-owned dairy cooperatives. The merger is expected to take effect on June 1, forming a cooperative with combined annual revenues exceeding €20 billion (US$23.2 billion).
The newly merged organization will operate under the Arla Foods name and retain its headquarters in Viby J, Denmark. Competition authorities across the European Union and relevant national jurisdictions have approved the transaction.
The merger brings together approximately 11,200 dairy farmers across seven European countries and creates a combined annual milk pool of 19.4 billion kilograms, significantly strengthening the cooperative’s position in global dairy markets.
Strengthening Market Position
The merger enhances Arla’s footprint in Germany, Europe’s largest dairy market, through DMK’s extensive manufacturing network and strong retail presence. DMK is Germany’s largest farmer-owned dairy cooperative and a leading supplier to major food retailers.
The combined business will expand capabilities across key dairy segments, including:
- Cheese production
- Dairy ingredients
- Infant nutrition
- Private-label dairy products
- Value-added dairy innovations
Company leaders say the merger will improve operational efficiency, accelerate innovation, and strengthen long-term food security amid growing geopolitical and economic uncertainty.
Leadership Perspective
Jan Toft Nørgaard, Chair of Arla Foods, described the approval as a significant milestone for European dairy farming.
“This is a landmark day for our cooperatives, for the next generation of dairy farmers, and for European food production. Together, we can secure the scale, economic resilience, and investment capacity needed to shape a food sector with a lower impact on climate and nature,” he said.
Peder Tuborgh, CEO of Arla Foods, emphasized the strategic importance of the merger.
“Together, we will become one of the continent’s strongest dairy producers for the future. Our ambition is to remain a trusted partner in safeguarding European food production while supporting farming practices that reduce environmental impact,” Tuborgh stated.
Reflecting Wider Industry Consolidation
The transaction represents one of the most significant cooperative mergers in the European dairy sector in recent years and reflects broader structural changes occurring across the global dairy industry.
Rising production costs, volatile commodity markets, sustainability requirements, and increasing pressure on agricultural supply chains are driving dairy cooperatives to seek greater scale and efficiency. Industry experts view consolidation as a key strategy for strengthening resilience and maintaining long-term competitiveness.
Both Arla and DMK have highlighted food security, supply chain resilience, and geopolitical uncertainty as major factors behind the merger, reinforcing the strategic importance of Europe’s dairy sector in ensuring regional food availability.
Continued Expansion Strategy
The merger follows a series of growth initiatives by Arla Foods. Earlier this month, the cooperative announced plans to acquire family-owned cottage cheese producer Brancourts and recently invested €300 million (approximately US$354 million) to expand its cheese production facility in Götene, Sweden.
The investment aims to meet growing global demand for high-protein dairy products and further strengthen Arla’s international market presence.
With the merger set to become effective on June 1, the combined cooperative is expected to play a major role in shaping the future of European dairy production, sustainability, and global dairy trade.
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