by Q Radio News
Two dairy processors have been given the go-ahead for a cross-border merger.
Authorities on both sides of the border have given the deal between Lakeland and LacPatrick the green light, saying it will not adversely affect the market.
The new society is to be called 'Lakeland Dairies Co-Operative Society Limited' and will begin trading at the end of March.
A number of standard legal and administrative procedures will be completed before then, while the two co-ops continue to operate independently with each setting its own milk price.
One the company's officially merge, it will become the second largest dairy processor on the island of Ireland, with a milk pool of 1.8bn litres.
The company will deal with around 3,200 farms across 15 counties, and will have an annual turnover in excess of €1bn.
Michael Hanley is CEO Designate of the new Lakeland Dairies.
He said, “We’re very pleased to have reached the conclusion of this process which is now a starting point for future significant progress.
"We are energised and ambitious to create strategic advantages in an intensely competitive market environment where we intend to ensure the best possible realisation of the benefits of this merger for our members and for all of our customers around the world.
“My management team and I will get to work immediately in order to drive efficiencies in the business and to make the new co-op a success.
"Significant work will have to take place to make the new organisation as efficient as possible and to return the strongest possible milk price back to our farmers.
"The combined businesses have the potential to be one of the powerhouses of the global dairy industry but we must work hard to realise that potential by creating economies of scale and combining our complimentary product mix.
"We will leave no stone unturned in continuing the growth, development and success of Lakeland Dairies.”
(Andrew McConkey, Chairman of LacPatrick Dairies, Michael Hanley, CEO Designate of the new Lakeland Dairies and Alo Duffy, Chairman of Lakeland Dairies)
Alo Duffy, Chairman of Lakeland Dairies said, “The merger will help us to create efficiencies across our organisation which will enhance value and maximise available market returns for the benefit of milk producers.
"I express our strong appreciation to the shareholders of both societies for their confidence in this historic development which will underpin the long term sustainability of our dairy farming enterprises for the future.”
Andrew McConkey, Chairman of LacPatrick Dairies said, "We look forward to the continuing future success of Lakeland Dairies as a fully integrated dairy industry player, creating efficiencies and further added value for our milk producers with enhanced global market access for our high quality dairy products.
"The merger gives our farmers the necessary security to make long-term business decisions and provides stability for continuing progress in dairy farming for the next generation.
"With a large milk pool and well-invested dairy processing sites on both sides of the border, the new Lakeland will be a co-op of considerable scale.
"We will work in the long-term best interests of dairy farmers while serving our valued customers with even greater capability and an expanded range of high quality, value-added dairy products."