The DMK Group and Arla Foods have announced their intention to merge, creating Europe’s largest dairy-focused cooperative. The merger, which is subject to approval from both cooperatives’ representative assembly and regulatory authorities, will bring together over 12,000 farmers and achieve pro forma sales of €19 billion.
“We see plant-based products as an attractive, complementary business area for us”
While the merger primarily targets the dairy sector, it also has significant implications for the growing plant-based dairy market. Both companies have increasingly expanded into the plant-based space, and the merger may further accelerate this trend.
Expansion of plant-based offerings
Arla Foods, traditionally known for its dairy products, has been expanding its plant-based product range in response to the growing demand for vegan alternatives. One of its recent innovations includes the launch of the Arla® Pro soft serve mix, a ready-to-use plant-based product designed for foodservice. Maria Anders, Head of Foodservice Germany at Arla Foods Deutschland, noted, “We see plant-based products as an attractive, complementary business area for us as a European cooperative.”
In addition, Arla has made advancements in the field of novel proteins, announcing a partnership with Novozymes in late 2024 to develop new protein ingredients through precision fermentation, which could further enhance its plant-based product portfolio.
Similarly, DMK Group has established a presence in the plant-based sector through its MILRAM brand, which offers plant-based options for retail and foodservice. At the INTERNORGA trade fair in Hamburg, DMK presented various vegan products, demonstrating its commitment to expanding its plant-based offerings.
Strategic positioning in the plant-based market
The merger of Arla and DMK will combine complementary strengths, resulting in a diversified product portfolio that includes both dairy and plant-based options. This diversification may help the merged entity strengthen its position in the growing plant-based market. With plant-based food consumption increasing, the new cooperative is likely to enhance its focus on innovation in plant-based products, in addition to its traditional dairy offerings.
The merger could enable both companies to leverage their resources to expand their plant-based product lines. Jan Toft Nørgaard, Chairman of the Supervisory Board of Arla Foods, commented, “The foundation of this partnership is our shared values, and I am very proud of this planned merger, which represents a win-win situation for our cooperatives. The strength of Arla and the DMK Group lies in our shared commitment to quality and innovation.”
Future outlook
The merged entity will retain the Arla name and be headquartered in Viby J, Denmark. Jan Toft Nørgaard will become CEO of the combined company, with Peder Tuborgh continuing as CEO and Ingo Müller joining the executive team to lead the integration process.
The merger is still subject to approval by the cooperatives’ representative assemblies and regulatory authorities. If it moves forward, it will enable the combined entity to invest more heavily in plant-based product development and innovation.
Heinz Korte, Chairman of the Supervisory Board of DMK Group, added, “We are proud of the planned merger with Arla, a cooperative that shares our commitment to innovation and value creation. This partnership strengthens the resilience of our cooperatives and makes a significant contribution to strengthening the competitiveness of our farmers.”
