Farm Ireland

Sunday 21 April 2019

Dale Farm confirms 'interest' in LacPatrick

Gabriel D’Arcy of LacPatrick Dairies. Picture: Paul McErlane
Gabriel D’Arcy of LacPatrick Dairies. Picture: Paul McErlane
Margaret Donnelly

Margaret Donnelly

The UK's largest co-op Dale Farm has said it is 'interested' in the announcement by LacPatrick yesterday that it is interested in a merger.

In a statement today, Dale Farm’s Nick Whelan stated: “As the largest farmer-owned dairy cooperative in Northern Ireland, and indeed the UK, Dale Farm has been made aware of the situation at LacPatrick and we have an interest in these developments.”

It's understood that the two processors have spoken in recent days.

Formerly United Dairy Farmers, Dale Farm is owned by over 1,300 dairy farmers across the UK.  With headquarters in Belfast, Dale Farm has 10 sites across the UK and a long-standing heritage in the dairy industry.

Its dairy portfolio spans milk, butter, cheese, yogurt, sports nutrition drinks, cultured products and desserts

According to Dale Farm, its business model presents the company with much room for growth, particularly in relation to Brexit, given its strength in the UK market and ongoing commitment to innovation and it has invested over £60m in the last five years into developing the business

However, it's understood a domestic deal, to merge with a rival with a more diversified income base, is the most likely outcome if there is a deal.

Lakeland Dairies is understood to be the most likely merger partner, according to industry analysts, but LacPatrick Co-op members will have the ultimate say, and any merger would need backing from 75pc of members.

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LacPatrick was formed from the merger of the old Town of Monaghan Dairy in the Republic and Ballyrashane Diary in Co Tyrone. It processes more than 600 million litres of milk from more than 1,000 farmers, roughly half on each side of the Border.

The business is profitable and has made significant investment to Brexit-proof its operations, but has been under pressure to lift its milk prices to match rivals.

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