Lakeland Dairies has announced the acquisition of L.E. Pritchitt & Company, a Northern-Ireland based food service business, for £13 million sterling (€18.5 million).

Pritchitt's, which was established in 1925, has a manufacturing facility in Newtownwards, Co Down and offices in Bromley in Kent.

The acquisition, which is conditional on receiving approval from the Competition Authority, should be completed in mid-July.

"This purchase perfectly compliments the Lakeland food service business," Lakeland chief executive, Mr Ed Prendergast, said. "It will expand Lakeland's range of branded products, increase its penetration in high value markets and consolidate the co-op's position as the leader in the food service sector in the UK and Ireland."

Following the acquisition, the two food businesses, which are of roughly equal size, will be combined. They will be run using the Pritchitts' name as a stand-alone division within Lakeland Dairies.

The merged business will be the largest UHT supplier to the British and Irish food service markets.

Pritchitt's factory in Newtownwards processes 90 million litres of milk on average each year. Of this, 72 million comes from the 99 contracted dairy farmers who supply the plant.

The amalgamation of Pritchitts' milk suppliers with Lakeland's will see the co-op's total number of Northern Ireland milk suppliers grow to more than 500.

This is Lakeland's third acquisition in 18 months following the purchase of the Bailieboro dairy business from Kerry Group and the Omagh dairy business from Nestle. Lakeland has also announced the appointment of Dr Chris Gibson as non-executive chairman of Pritchitt.