Dawn Dairies milk business in Co Galway, owned by the Kerry Group, is set to be taken over by Arrabawn Co-op in a deal which is understood to be worth nearly €6 million.
Arrabawn Co-op entered into a 30-day consultation process with Dawn Dairies employees on Tuesday to discuss the transfer of the business. Arrabawn has now agreed in principal to go through with the purchase.
The purchase is a positive move for the co-op, says chairman of Arrabawn, Michael Flaherty, who claimed it would strengthen the company’s position in the market. He said Arrabawn and Dawn milk collection and milk sales operations overlapped geographically and rationalising the businesses would lead to significant savings and gains.
It is hoped the purchase will lead to maximising production volumes at the plant in Kilconnell, Co Galway, and the increased throughput at the plant will lead to additional employment. However it is feared the acquisition could lead to job losses elsewhere.
