First Milk has appointed Mike Gallacher, the former UK MD of Mars Petcare, as its new CEO.
Gallacher will replace Kate Allum, whose departure from the dairy co-op’s helm was announced earlier this week. He will start his new job on 18 March.
First Milk chairman Sir Jim Paice MP said Gallacher had “all the attributes to put our business back where we want it to be”.
The former army officer spent most of his civilian career with Mars Inc. where he held a series of senior leadership positions, and led significant business turnarounds in Asia for Mars, in addition to working in regional leadership positions in both Asia Pacific and Europe, said First Milk.
“He has considerable leadership qualities, has turned around businesses in different geographies, and has experience in some of our key export markets,” added Paice, and “demonstrated throughout the interview process that he has rapidly built high performing teams and organisations throughout his career and I look forward to working with him”.
The Grocer reported this week that Allum’s departure had been decided in November, with sources claiming First Milk decided to delay the announcement so as not to “de-stabilise the business any more than it is”.
First Milk has experienced turbulent times of late. It was forced delay farmer milk cheques for two weeks in January amid cash flow problems, and has initiated a series of farmgate milk price cuts.
It subsequently launched a new milk payment system to better cope with fluctuations in milk volume and demand, offering farmers an A and a B price for their milk. However, this new structure was derided by the National Farmers Union which described them as “shockingly low”.
On her departure, Paice thanked Allum “for her drive and leadership over the last six years” and wished her well for the future.” She will remain with the business in the short-term to assist Gallacher with a “full handover”, said First Milk.
Gallacher said he was “excited about leading the First Milk business”, despite the challenging conditions present in the dairy market.
“Over the coming weeks I look forward to meeting farmer members, employees, partners and customers as we work together to address those challenges with urgency and focus.”
Responding to First Milk’s announcement, the National Farmers Union today (13 March) said it would be seeking “urgent talks” with Gallacher.
In a statement, it welcomed the appointment “for ensuring a swift change in management and minimising disruption for First Milk members”.
However, it warned that action should be taken now “to save farmers from the dire situation they have been forced into” by First Milk’s policy of deferring farmer payments and its new A and B pricing formula.
“The priority must now be to move the business forward and identify measures that can reverse the devastatingly low milk prices that farmers are being forced into accepting and to create a sustainable business,” said NFU dairy board chairman Rob Harrison.
“First Milk members are fed up of rumour about the state of First Milk,” he added. “We understand that the new CEO will face a difficult time ahead, and with a new page being opened now is the time to be transparent and honest with First Milk members.”
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