The two food companies are merging their Argentine dairy operations into an equally owned joint venture aimed at driving growth and innovation in the Latin American market.

Danone and Argentine food group Arcor are taking their more than two-decade-long partnership to a new level with the establishment of a joint venture focused on the Argentine dairy market. Danone announced the move in a press release.

The new company brings together Danone’s Argentine dairy business (Danone Argentina SA), Mastellone Hermanos SA, and their shared logistics subsidiary Logistica La Serenísima. Mastellone Hermanos has roots in Argentina’s dairy market spanning almost a century, whilst Danone has been present in Argentina for thirty years.

Eleven production plants
The joint venture will operate eleven production plants across the region, producing, amongst other products, milk, dulce de leche, cheeses, butter, cream, yoghurt, and desserts. According to the two companies, the merger will create the foundation for faster innovation, enhanced operational efficiency, and greater commercial reach for the benefit of Argentine consumers.

Danone and Arcor will each hold a 50 per cent stake in the new company, and following the closing of the transaction, Danone’s share will be reflected within equity-accounted companies in its financial statements.

Senior executives see significant potential
Danone’s Chief Executive, Antoine de Saint-Affrique, highlights the importance of the strengthened alliance:

“With this operation, we are delighted to take our long-term partnership with the Arcor group to the next level. This underlines our commitment to the Argentinian market and Latin America. Combining our assets will create a powerful growth platform with more opportunities for innovation, operational efficiency and greater reach. It’s all about bringing healthy, quality dairy brands to more consumers in Argentina now and in the future,” he says.

Arcor’s President, Alfredo Pagani, describes the establishment of the joint venture as a decisive step:

“The creation of this dairy joint venture with Danone represents a decisive step toward enhancing the commercial, operational, and management capabilities of both companies. This alliance will accelerate growth through an integrated strategy focused on the development of high value-added products. For Arcor, this is a strategic project that reaffirms our commitment to the country and strengthens our value proposition in the consumer food products market,” he says.

The transaction remains subject to customary closing conditions, including regulatory approval.

By Maja Løvstrup
Photo: Danone