Emmi and the dairy farmers
There is a close relationship between Emmi and its milk suppliers. Dairy farmers own the majority of the company’s shares. The relationship between Emmi and the dairy farming industry has a long history and clearly warrants a closer look.
In 1907, 62 cooperatives founded the Central Switzerland Milk Association in Lucerne (Zentralschweizerischer Milchverband, MVL). The Association gained a foothold in the canton of Lucerne in 1919 through the purchase of milk from the Neuhüsern dairy cooperative in the commune of Emmen. Initially, only Sbrinz hard cheese was produced there during the 1920s, with production of soft cheese beginning in the 1940s.
The Emmi brand was born in 1947 and was first used to market cheese, followed by yogurts in 1954. In 1960, a second production facility was constructed in nearby Dagmersellen to process the steadily growing milk deliveries. In the following decades, sales continued to rise, with cheese and increasingly yogurts being exported.
Separating milk and the market
At the general meeting of the MVL (known as ZMP from 1999) on 23 June 1993, the cooperative’s members decided that all its activities should in future be separated from any commercial decisions, and founded Emmi AG.
The new company’s purpose was to consolidate its national market leadership by strategic means and its activities abroad through the expansion of its export business and licensing.
In 1998, the MVL was restructured, with the dairy farmers association and the company becoming separate in personnel Terms too.
Stock exchange listing brings capital for growth
In early 2000, when Switzerland’s dairy industry underwent a complete political overhaul, the MVL ’s Board began considering the risks, advantages and disadvantages of listing Emmi on the stock exchange. On 5 July 2004, the decision was made to increase the company’s share capital and thus take it public.
To this day, the majority of Emmi shares are held by Central Switzerland’s dairy farmers. At the end of 2018, the ZMP Invest AG (a subsidiary of ZMP) owned 53.2 % of the company. The second and third largest shareholders are two other players in the dairy farming industry: the Zentralschweizer Milchkäuferverband (Central Switzerland Milk Purchasers Association) and the Milchverband der Nordwestschweiz (Association of Milk Producers of Northwestern Switzerland).
Emmi’s strategy dictated by dairy Farmers
As the majority shreholder, the ZMP exerts great influence on Emmi’s strategy. Of the company’s nine members of the Board of Directors, three – Christian Arnold-Fässler, Franz Steiger and Thomas Oehen-Bühlmann – also sit on the ZMP’s Board, while another two – Monique Bourquin and Chairman Konrad Graber – act as the ZMP’s representatives.
A share in the company’s profits
Among the dairy farming players involved, all decision-makers fully understand that agricultural interests must take a back seat to Emmi’s market presence. To secure their future, the milk suppliers behind Emmi are dependent on it being a stable company and achieving long-term success. Emmi’s owners participate in the company’s profits via profit distributions (dividend) and increases in the company’s value – which have been remarkable. The Emmi share ended its first year on the stock exchange (2004) at 115 Swiss francs. By end of 2019, it was worth 700 francs more. For the 2018 financial year, an average ZMP member received a share of the profits of around 5,600 Swiss francs.
Central Switzerland Milk Producers Cooperative ZMP: http://www.zmp.ch/