DMK Group eyes “lucrative” markets in Asia, Europe with full DV Nutrition takeover
06 Sep 2019 --- German dairy cooperative DMK Group and Volac are ending their joint participation in DV Nutrition (DVN), with the company’s assets becoming wholly owned by DMK Group. By acquiring DVN, DMK hopes to operate in more lucrative markets with higher added value, such as baby food, clinical nutrition and food applications in Asia and Europe. This is according to Oliver Bartelt, Global Head of Corporate Communications at DMK, who spoke to NutritionInsight.
DVN will be integrated into the “whey ingredients” division within the industry business unit and will be managed by the subsidiary wheyco. The DVN and wheyco portfolios will be coordinated as part of a further optimization so that DVN products can be supplied to growth markets, such as Asia, in the future, he explains.
DMK hopes to operate in more lucrative markets with higher added value, such as baby food and clinical nutrition. “We will promote the growth of whey-based products and take a targeted approach to develop innovative protein products, thus establishing ourselves as leaders in the market. Operating in value-added markets such as baby/infant food and clinical nutrition in Europe and Asia serves as a particularly important step in this regard. To be able to grow in these markets with the above-mentioned applications and the required whey quantities, the complete takeover of JV by the DMK Group is an important strategic step for us,” Barlet continues.
The decision reflects the fact that both partners wish to develop their businesses in different directions, the companies share in a statement. Separation of activities will enable clear and focused strategies for the future to be implemented for both Volac and DMK Group, aimed at delivering the “best interests of their respective businesses, stakeholders and shareholders.”
DMK has highlighted its view to expand in Asia and European markets. Andy Richardson, Head of Corporate Affairs at Volac tells NutritionInsight that Volac “is committed to supplying its customers in UK, EU and ROW market. As a business, our plan is to continue to grow both production capacity and sales in all markets.” He adds that the decision is not related to Brexit and the timing has “no special significance.”
As of January 1 2020, subject to prior competition clearance, the DMK Group is expected to acquire all of the shares in the joint venture.
Earlier this year, DMK made a large investment in its infant nutrition capabilities. It inaugurated a new plant in Strückhausen, Germany, featuring cutting-edge technology. DMK reported that the facility will be used solely for the production of infant nutrition, such as its Humana brand. DMK has invested €145 million (US$164 million) in converting the site into a “state-of-the-art” facility.
By Laxmi Haigh and Katherine Durrell
