The Foston-based Starcross dairy could now be used to supply a major supermarket contract after the buy-out.

It is its third change of ownership in as many years after originally opening as Amelca, with about �7m investment from 150 farmers across the region.

It was taken over by Starcross after it went into receivership within three months of its launch in 2002.

Dairy Crest has also announced a deal to supply the Morrisons supermarket chain with half its fresh milk.

Chief executive Drummond Hall said: "The acquisition of Starcross reinforces our commitment to the retail milk business and our customers.

"Starcross is an advanced modern facility, which will significantly extend our geographical footprint across England and Wales to cover most of the major northern conurbations."