Wed, 11 May 2016 | DIVISION SALE
County Cavan-based Lakeland Dairies Co-operative has acquired the dairy division of Newry-based Fane Valley for an undisclosed sum, it has been reported.
The new deal represents a simpler solution to a proposed merger between the two dairy manufacturing companies announced in August last year. A statement from the companies said that the less complex structure was "considered to be a better option” than the original merger.
Michael Hanley, the chief executive of Lakeland Dairies Co-operative, said of the most recent deal: "The strategic rationale behind Lakeland Dairies and Fane Valley co-operating to advance the interests of their respective businesses is as strong today as it was in August 2015.
"It is extremely positive that the boards of both co-operatives have had the foresight to recognise the limitations of the initially proposed joint venture arrangements and the courage to adapt and revise their approach.”
Fane Valley boss Trevor Lockhart backed Mr Hanley’s statements, saying that the division sale represented the best interests for both businesses — leading to “greater economies of scale and enhanced market capability”.
Within Northern Ireland alone, the companies purchase around 250 million litres and 330 million litres of cow’s milk respectively per year. Both firms use this milk to manufacture a variety of dairy products and other ingredients for the food industry. The firms both rely one hundred per cent on export markets for all of their products.
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