Two large Midwest dairy cooperatives, Prairie Farms Dairy and Swiss Valley Farms, have entered into a merger agreement.
Under the terms of the agreement announced Dec. 16, the assets of Swiss Valley Farms will be merged into Prairie Farms. The combined company will operate under the name Prairie Farms Dairy, Inc.
Terms of the agreement must be approved by members of both cooperatives. The deal is expected to close in mid-2017.
Swiss Valley has five cheese and whey powder plants, located in Luana, Iowa; Shullsburg and Mindoro in Wisconsin; and Rochester and Faribault in Minnesota. Swiss Valley Farms chief executive officer Chris Hoeger will continue to oversee the operation of those plants.
The two co-ops share some business history. Swiss Valley sold its Dubuque, Iowa milk-bottling plant to Prairie Farms in 2009 to devote all its attention to cheese production.
“The merger with Swiss Valley was driven by our commitment to build value for our cooperative members and is consistent with our growth strategy. Swiss Valley’s contributions will allow us to diversify our product portfolio and expand into new markets,” said Ed Mullins, executive vice president and chief executive officer of Prairie Farms.
"We are very excited to be joining forces with Prairie Farms,” said Hoeger. “This merger offers numerous benefits for our cooperative members and is an ideal opportunity to bring together two industry leaders. We will leverage the strengths of both companies to offer a broader range of products and to enhance and expand relationships with customers.”
Prairie Farms Dairy is one of the largest dairy co-ops in the Midwest, with over 600 farm families, 5,700 employees, 35 manufacturing plants, over 100 distribution facilities as well as annual sales of more than $3 billion. Headquartered in Carlinville, Illinois, its distribution footprint covers over 30 percent of the U.S.
Headquartered in Davenport, Iowa, Swiss Valley Farms has 400 dairy producer members in Iowa, Wisconsin, northern Illinois and southern Minnesota. It also operates two subsidiary companies, Rochester Cheese and Caves of Faribault, Minnesota. In addition, in a joint venture with Emmi-Roth, Swiss Valley Farms co-operates White Hill Cheese Co., LLC in Shullsburg, Wisconsin.
Despite its location in the Midwest, Swiss Valley created a substantial export business beginning in 2008. By 2015, exports accounted for about 10 percent of all Swiss Valley sales, earning the company this year’s U.S. Dairy Export Council “Tom Camerlo Exporter of the Year Award.” 
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Dave Natzke
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