Dairy Farmers of Britain is creating the largest milk cooperative through the acquisition of the Co-op’s milk processing business for £75m.

DFB is buying Associated Co-Operative Creameries, Britain’s fourth biggest milk cooperative with brands including Dairygate, Alive and Dawn. The move will also make DFB the country’s third largest milk processor.

DFB, which was formed in July 2002 by farmers who were dissatisfied with the milk distribution system, markets about two billion litres of milk a year from 3,250 member farms and supplies more than 100 national and regional dairy companies.

Associated Co-Operative Creameries was formed in 1972 and has seven milk processing sites.