A TAKEOVER deal giving the Danish company behind Lurpak butter full control of Britain’s largest supplier of milk to supermarkets is about to be unveiled.

Insiders believe details of the £430m deal to buy Arla UK could be announced as early as this week.

The British company, whose products include Cravendale milk and Anchor butter, is expected to agree a takeover at about 71p a share. On Friday night, the shares were changing hands at 63¾p.

Arla UK is being bought by the Danish company — also called Arla — that already owns 51% of the British business.

The two sides disclosed in October that they were discussing a deal that would give the Danish company full control of the British operation.

But negotiations ran into trouble as the two sides struggled to find a formula for covering a hole in Arla UK’s pension scheme. Last September, the size of the deficit was put at £143m.

Attempts to deal with the pensions issue were interrupted by the Christmas break, but now a solution has been found, according to insiders. They hope to clinch the deal by Wednesday, but warn that an announcement may not come until next week.

Arla UK supplies 45% of all the milk sold in large supermarkets. In the milk market as a whole, it is slightly smaller than Dairy Crest and Robert Wiseman.

The Arla UK business was created in its present form three years ago when Arla’s established British business merged with Express Dairies.

Some 5% of Arla UK is owned by Milk Partnership, a group of suppliers that provide milk to the company for processing. Arla in Denmark is owned by a co- operative of 10,600 farmers. It is Europe’s second-largest milk dairy company.

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