Alto, LOL Form Cheese Joint Venture

April 24, 2001

Alto Dairy Cooperative and Land O'Lakes, Inc. have formed a cheese marketing joint venture, bringing together the commodity cheddar and mozzarella sales teams and marketing efforts of the two companies. Officials of both companies said the focus of the new venture, a marketing agency in common (MAC), will be to enhance customer service, expand product offerings, reduce costs and provide customers with national product sourcing.

"This joint venture is also based on our common dedication to operational efficiency and customer focus," said Land O'Lakes President and Chief Executive Officer Jack Gherty. "It will enable us to leverage the combined resources and expertise of our two organizations to reduce costs and enhance service to our commodity cheese customers."

"Customers can expect a wider selection of product offerings, more efficient delivery and an even broader range of technical support and services," added Alto President and General Manager Larry Lemmenes. "We will capture the efficiency of a combined sales force and coordinated delivery system, as well as enable our customers to benefit from a national sourcing and distribution system."

The cooperative leaders added that the marketing alliance recognizes the intensely competitive and rapidly consolidating dairy foods marketplace and the two companies' complimentary geography and product lines. The joint venture applies only to the marketing of commodity cheddar and mozzarella and does not involve value-added products.

"Both our organizations have deep roots in Wisconsin and confidence in the ability of the state's dairy producers to compete long-term," Gherty said. "We are committed to helping the state's dairy producers compete successfully in the highly competitive, 21st century marketplace."

"Recent years have seen Wisconsin realize steady growth in long-term sustainable dairy operations, as well as consistent growth in per cow milk production," Lemmenes said, adding that year 2000 milk production in the state increased more than one billion pounds from 1997.

Lemmenes and Gherty also said that the two cooperatives are not going forward with a joint venture cheese plant that had been under study during the past year. They indicated that a diverse combination of factors -- from the current economic environment and conditions in the dairy industry to construction costs and financing options -- all worked to limit the feasibility of new plant construction at this time.

Alto Dairy Cooperative (http://www.altodairy.com) is a 100-year-old, member-owned cooperative serving dairy producers throughout Wisconsin and Michigan's Upper Peninsula. It manufactures an extensive line of cheese and value-added dairy products at two state-of-the-art facilities and is a national marketer of milk replacers for the veal calf industry.

Land O'Lakes (http://www.landolakesinc.com) is a national, farmer-owned food and agricultural cooperative, with sales approaching $6 billion. Land O'Lakes does business in all 50 states and more than 50 countries. It is a marketer of a full line of dairy-based consumer, foodservice and food ingredient products across the United States; services its international customers with a variety of food and animal feed ingredients; and provides farmers and local cooperatives with an extensive line of agricultural supplies (feed, seed, crop nutrients and crop protection products) and services.