AXIS the Lower Wick-based milk company, looks set to merge with Scottish Milk Ltd producing the largest farmers' dairy co-operative in Britain.

The proposed new business, which will be known as British Milk, will market more than 2.2billion litres of milk a year from dairy farms to processing companies throughout the British mainland and Northern Ireland.

The merger has been agreed in principle between the companies' two boards, with the completion set for the start of April 2001.

However, the merger should not mean job losses affecting the 35-strong workforce, according to Axis' communication manager Jonathan Horrell.

"There will continue to be offices in Worcester and Paisley," he said. "Changes are likely, but more in terms of looking for opportunities to grow. This is not a merger driven by the desire to cut costs."

He added that the plans for Axis, formerly known as Milk Marque, to move to new offices in Hallow in the springtime remained unaffected.

The new company will be worth in the region of £400m with a share in the British milk market of around 18 per cent.

Axis began trading in April this year and its chairman, Roger Evans, said the proposed merger would be good news for his company.

"Axis was created to grow and we have made great strides in the past year," he said. "Our business has become a major player in the milk market from a standing start.

"Creating British Milk fulfils our key growth strategy and provides us with a national service capability.

"It provides us with the benefits of partnership with an established player in the market with a strong track record and it provides us with the potential to offer new services to Axis members."