Banbridge-based Fane Valley has merged some parts of its business with Lakeland Dairies in a move which will ‘reinforce their position as a global player’.
There will be no job losses and this move will make Fane Valley the second largest producer of milk in the island of Ireland.
Trevor Lockhart, Chief Executive of Fane Valley said: “This far sighted agreement represents the strong commitment of Fane Valley and Lakeland Dairies to support our members, milk producers and customers through the development of an even more competitive market position on a joint venture basis.
“The combined strength and backing of both co-operatives will ensure success for our agribusiness and dairy operations and will underpin future success.
The first Joint Venture is being established by a merger and pooling of both of the societies’ feed manufacturing, sales and stores activities into a major agribusiness company to be managed by Fane Valley.
Lakeland Dairies will be a partner and shareholder in the agribusiness Joint Venture and will also be represented on the board of the new company.
The projected annual revenues will be £120million.
The second joint venture is being established by a merger and pooling of both of the societies’ dairy processing activities and operations, to be managed by Lakeland Dairies.
Fane Valley will be a partner and shareholder in the dairy joint venture.
The purpose of the dairy joint venture is to create a business of greater scale and efficiency with the capability to grow and to compete even more intensively on a global basis.
Combined with the total existing Lakeland Dairies milk pool, the Dairy Joint Venture will process over 1 billion litres of milk annually.
The projected annual revenues will be £480million for this venture.
William McConnell, Chairman of Fane Valley Co-operative said, “This partnership will strengthen our position as a co-operative society while providing farmers with a firm platform for future sustainable growth and development.
“We look forward to working with Lakeland Dairies as we work together to exploit the future benefits of this development for our producers”
Fane Valley Dairies market a range of powders, butter and butter oils to customers across Africa, South America and Asia. The Mourne Maid brand is widely known across the world.
Fane Valley Group Communications Manager, Niall McCool, said: “There is massive amount of potential. We already have a strong pedigree of exporting and this move will make us significant on an international scale.”