Arla Foods, based in Leeds, is owned by Danish, Swedish and German dairy farmers. It buys 90% of its milk in the UK through a long-term agreement with 1,300 dairy farmers. It owns brands such as Cravendale, Lurpak and Anchor.
Arla Foods UK chief executive Peter Lauritzen said that Arla has a strong record of investing in facilities and brands in the UK.
"Together we will be able to offer British retail and foodservice customers with a full range of high quality dairy products from a single, secure, source, making us an even more attractive partner for British retailers," Lauritzen added.
Bristol-based co-operative Milk Link has eight processing plants in the UK. It is a leading producer of cheddar cheese and exports its products to nearly 20 countries.
Milk Link chief executive Neil Kennedy said that through the merger, Milk Link's 1,600 British dairy farmer members will have a stake in one of Europe's largest and most successful dairy businesses.
"Our farmers will benefit from Arla Foods' long term strategic vision, global scale, broad product and customer base and proven track record in investing in the development and growth of leading dairy brands," Kennedy added.
