The Swedish-Danish multinational cooperative and owner of the Cravendale and Lurpak brands approved the project at a meeting in London earlier this week.
Of the £460m set to be invested, £72m will be spent in the UK, the company’s largest market, with ten of its 12 British factories receiving upgrades.
Arla’s carbon net zero site in Aylesbury will see the biggest proportion of UK spend with an investment of £33.6m as it becomes the UK home to the production of Arla’s Lactose free dairy products using milk from UK farmers in the south east and the Midlands.
The investment in Aylesbury is set to provide new facilities for the production of new product packaging using flexible pouches. Arla has pledged use only 100% recyclable plastic by 2020 and 50% recycled plastic in its plastic milk bottles.
Tomas Pietrangeli, managing director, Arla Foods UK, said: “Arla is the biggest dairy company in the UK, owned by 11,200 farmers across Europe.
“This investment is almost double the investment of last year and, with the exception of building the Aylesbury dairy, it is the biggest annual investment for Arla in the UK.
“While milk prices remain volatile and Brexit brings both uncertainty and opportunity, Arla farmers in the UK and across Europe are committed to continually investing in our UK business to maintain pace with the demand for nature’s original superfood, and the consumer choice it creates.”
The rest of the investment is set to be spent on further growing sales outside of Europe, where the firm's fastest growing markets are, including the US, Middle East and China.
“Arla has a history of good investments for sustained growth," said chair of Arla Foods, Åke Hantoft. "The board of directors has decided to increase our investments with this plan, because we have identified new projects and investments with short and long term potential for significant return.
“The business growth these investments will create for our company will generate growth opportunities for our farmer owners. We see these investments as essential to the future of our business.”