Finnish dairy cooperatives Osuuskunta ItäMaito and Osuuskunta Maitosuomi merge to become Valio’s biggest shareholder

By Jim Cornall

- Last updated on GMT

The new cooperative will become Valio’s biggest shareholder.
The new cooperative will become Valio’s biggest shareholder.

Related tags Valio Dairy companies Finland

Valio milk procurement owner cooperatives Osuuskunta ItäMaito and Osuuskunta Maitosuomi are to merge, launching on September 1, 2019.

The chairman of the board of each outgoing co-operative signed the merger agreement late last month 2018 in Helsinki. The final decision on the merger will be made by the cooperatives’ delegate meetings this autumn.

The new cooperative, which will become Valio’s biggest shareholder, will be named Osuuskunta Maitosuomi, located in Lapinlahti. The merger will enable the further development of services for dairy farmer entrepreneurs and greater resource efficiency.

Biggest supplier and shareholder

Esa Kotala, chairman of the board of Osuuskunta Maitosuomi, said the number of dairy farmer entrepreneurs in Finland has been falling by 5-7% each year for some time, which reduces the number of members in the milk producer cooperatives.

He said the merger will enable the new cooperative to enhance operations and secure the future of services offered.

“Advisory and expert services will be more effective together and serve the entrepreneurs more efficiently. And a large unit promotes specialization. All services can be provided in Finnish and Swedish,”​ Kotala said.

The new cooperative will hold 20,849 Valio shares (42.7%), and will also be the major Valio player for raw milk intake at around 900m liters per year. Together, the co-operatives supply nearly half of the raw milk volume taken in by Valio.

Board structure

Osuuskunta Maitosuomi has a little over 1,100 dairy farmer members and Osuuskunta ItäMaito just under 1,600.  Osuuskunta ItäMaito’s offices are based in Lapinlahti and those of Osuuskunta Maitosuomi in Seinäjoki. Of the 23 dairy farmer members on Valio’s supervisory board, four represent Osuuskunta Maitosuomi while ItäMaito has six.

Mikko Heikkinen, chairman of the board of ItäMaito, said, “The new cooperative’s Lapinlahti domicile puts it close to the heart of the combined operating area, which extends from Ostrobothnia to North Karelia and from Kainuu to Central Finland.

“Lapinlahti’s current cheese and powder plants’ modern premises are ideal for the new cooperative’s personnel. Most of the staff will be serving the entire territory. The new cooperative is being christened Maitosuomi (‘Milk Finland’), which aptly describes its new operating area stretching across a large part of the best milk production regions in Finland.”

The first election of delegates will be held in autumn 2019, while a board of directors will be elected in late 2018 for the transition period.