First Milk secures new refinancing deal to fund expansion plans

First Milk, a leading dairy farmer co-operative in the UK, has secured a £120m refinancing deal to fund its expansion into the food sector over the next three years.

The latest deal was provided by Lloyds TSB Commercial Finance and Barclays, which also offered a £130m funding package to the co-operative in 2009 in order to facilitate its long-term expansion into functional foods sector.

Lloyds TSB Commercial Finance client manager Steve Chapman said the previous deal enabled the co-operative to successfully execute its expansion plan, and the new package will help it to further pursue its growth strategy over the next three years.

First Milk finance director Ian Forgie was quoted by the BBC as saying that the co-operative is pleased with the support it has received from Lloyds and Barclays.

"They understand that our drive is all about building an added value food company that can generate a range of income streams at home and abroad, which gives us the ability to pass back better returns to our farmer shareholders," Forgie added.

The latest refinancing follows several deals undertaken by First Milk – in September 2011, it formed a joint venture with New Zealand-based company Fonterra to produce premium whey proteins for use in functional food products for consumers across Europe.

In May 2012, First Milk acquired CNP Professional, a leading sports nutrition business, as part of its strategy to further expand into the premium functional food sector.

First Milk, based in Glasgow, is involved in milk supply, cheese production and ingredients development, and also supplies retailers with own-label products as well as brands such as Mull of Kintyre and the Lake District Cheese Company.

It has farmer members in England, Scotland and Wales, who supply 13% of the total milk produced in the UK.

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Image: First Milk’s latest refinancing deal will help the co-operative to support its strategic plans over the next three years. Photo: courtesy of First Milk.