Dairy co-op shareholders approve merger ahead of Brexit
Lakeland and LacPatrick dairies have facilities and members on both sides of Border
Andrew McConkey, LacPatrick Dairies chairman (left) with Lakeland Dairies chief executive Michael Hanley and chairman Alo Duffy.
Shareholders of Lakeland Dairies and LacPatrick Dairies have approved the merger of the two dairy processing co-operatives in separate ballots.
Lakeland shareholders met in Co Cavan and LacPatrick shareholders met in Cookstown, Co Tyrone, for ballots that resoundingly backed the merger, which comes ahead of what could be a difficult Brexit period in 2019.
Some 97.2 per cent of Lakeland Dairies shareholders and 95.9 per cent of LacPatrick shareholders voted in favour of creating a new organisation that will adopt the name of Lakeland Dairies.
The two co-ops have farmer members and processing facilities on both sides of the Border.
“By combining our co-operatives and operations, we will continue our strong progress in a very meaningful way,” said Lakeland chairman Alo Duffy.
“The new society being formed through this merger will continue to be farmer owned and controlled while paying a sustainable and competitive milk price in line with market conditions into the future.”
Andrew McConkey, LacPatrick Dairies chairman, said the co-ops were confident that both sets of shareholders had “created a sustainable platform for dairy production in the northern half of the country”.
Lakeland chief executive Michael Hanley, who will be group chief executive of the new society, said the combined organisation would be “a competitive, international dairy food business” that would secure the future of its dairy farmer members for generations to come.
“It will deliver economies of scale and commercial synergies, processing increased volumes of milk and providing greater capability to address global customer needs for high quality dairy foodservice, food ingredients and consumer products.”
It is expected that the merger will be completed in early 2019, subject to regulatory approvals. The new Lakeland Dairies will have 3,200 suppliers and will process more than 1.8 billion litres of milk a year, with annual revenues of more than €1 billion.
The Irish Farmers’ Association welcomed the merger, but said the new organisation “must deliver on the faith demonstrated by shareholders” in the ballots.
“The merged entity must position itself in the best possible way to optimise dairy processing and marketing and to pay a strong price to farmers,” said IFA president Joe Healy.
“This is particularly critical in the context of Brexit.”