A-ware has been making good progress in the Netherlands for years, and now the cheesemaker is spreading its wings in Belgium as well. Two acquisitions were announced this month alone. It also previously bought a Belgian powder tower from FrieslandCampina. A-ware also has impressive construction plans in other European countries, although plans are also ready in Heerenveen for further scaling up. Where does this expansion drive come from?
Ten years ago, A-ware was still unknown to many, but the company is now part of the established order. The Dark Horse of dairy, so to speak, because the advance is impressive. And also a bit contrary. Many dairy companies are looking at the market somewhat timidly for fear of a devastation among farmers, fueled by the nitrogen plans in The Hague. After all, without milk there is no raw material for producing butter, cheese or milk powder. At A-ware they are also concerned, but at the same time they dare to invest heavily.
Focus on Belgium
Initially in our own country, but the focus of CEO Jan Anker and associates is now on Belgium. I had doubts about Belgium - from Het Goede Doel - they jokingly seem not to know. The acquisition cycle started at the end of 2020 with the intention to acquire the powder towers of FrieslandCampina in Aalter. And so happened. Although the move to Belgium is not that big geographically, the takeover was a leap into the deep. The cheese company has no experience in the powder market, but does see great opportunities. “Powder sales is a new business unit for us that we have to build from scratch,” Anker said at the time. He sees opportunities in Africa and Asia. A-ware decided not to reinvent the wheel itself and entered into a partnership with Hoogwegt, who already know the global powder market inside and out. Apparently a smart move.
For the sourcing hundreds of dairy farmers were released from - mainly - the Belgian dairy cooperative Milcobel. There, A-ware benefits from a dissatisfied base, just like at FrieslandCampina a few years ago when the company was looking for milk in Heerenveen. In that respect, it is not a problem that the apples hang loose on the tree.
This week it was announced that A-ware acquired the shares of the Belgian company dairy company Olympia takes over. With 100 million kilos of milk from 165 dairy farmers, this is a serious milk pool. Earlier this month, A-ware also bought the Hollebeekhoeve emerging from bankruptcy. This takeover may be small, but it is a signal that the dairy company wants to establish deep roots in Belgium. While the powders from Aalter are mainly intended for the world market, Olympia and Hollebeekhoeve are mainly for 'local' sales in Belgium. Once again a signal that A-ware wants to spread its activities in the dairy industry. Although there is no apparent line in the acquisitions, the plans are not inimitable from a risk perception perspective.
Ireland, Estonia, Italy, Switzerland and Heerenveen
In addition to spreading activities, A-ware also aims for geographical spread. In the meantime, A-ware has finally been given the green light to build in Ireland. Together with dairy cooperative Glanbia, it wants to build a new factory in Kilkenny to process 450 million kilos of milk annually. The investment costs are estimated at €140 million. The plans in Ireland dated from before A-ware set foot in Belgium, but were boycotted for a long time by an Irish environmental club. The list of countries continues. In 2016, A-ware expanded to Italy and exactly one year ago it was announced that A-ware – together with Interfood and a local party – will build a dairy factory in Estonia. Here too, cooperation is probably consciously sought. A-ware is also active in Switzerland, again with a local player.
Back to your own country. With the many foreign adventures, you would almost think that A-ware is trying its luck elsewhere. Nothing seems further from the truth. At the end of last year, the Friesch Dagblad revealed that A-ware - together with Fonterra - has submitted a permit application to expand the factory in Heerenveen. The plans did not come out of the blue, however. Next to the factory in Heerenveen there is a vacant lot owned by A-ware. It has never been a secret that this site might be used to scale up production in the future. The new permit mentions 300.000 tons of cheese, almost twice as much as the current capacity. COO Klaas de Jong, who is responsible for this project internally, wanted it upon inquiry little was said about it at the time.
A-ware probably wants to wait for the nitrogen blueprints from The Hague before breaking ground again in Heerenveen. If there is a significant decline in dairy farming, sector-wide overcapacity is likely. Nevertheless, the plans show ambition, something that will undoubtedly appeal to many dairy farmers. In anticipation of the realization, finding new caravans of dairy farmers will be quite a challenge. Almost all processors are in the Netherlands woke up and hint at new suppliers. From that perspective, A-ware's foreign expansion drive is not entirely illogical.