Dairy sues Safeway for £10.6m

EXPRESS Dairies is suing Safeway for £10.6m in the High Court after the supermarket chain terminated a milk supply agreement and switched to a rival.

Details of the dispute emerged in listing documents for Express's planned £150m merger with Lurpak butter group Arla of Scandinavia. Talks with Safeway failed, so Express issued a damages claim this month for breach of contract.

Trading in Express shares is due to restart today. They were suspended at 25 1/2p pending publication of the listing particulars. The firm, founded in 1864, has struggled against over-capacity in the milk industry and the supermarkets' pricing power.