Through the deal the producer of the Clover, Vitalite and Utterly Butterly brands, will acquire two dairies at Liverpool and Nottingham and 77 distribution depots.
Dairy Crest currently operates its own milk delivery business and says the combined group would have a 45% market share and two million customers.
Although the deal is expected to bring about cost savings, which could mean job losses, the unification of the groups may help to slow the ongoing decline of the milk delivery business largely brought about by the low price of milk in supermarkets.
In order for this sector to have a viable future, further consolidation of the industry was required, said Arla chief executive Tim Smith, in comments reported by the BBC.
Express Dairies, which serves small and medium-sized retailers, wholesalers along with schools and restaurants, currently has 1,850 employees and distributes 390 million liters (686 million pints) of milk each year.
