MURRAY Goulburn has turned down an offer by a rival dairy company to keep its Leitchville factory operating after next month.
United Dairy Power met with the dairy giant yesterday to discuss buying the cheese making facility to process its own milk, but the offer was "flatly refused", according to UDP managing director Tony Esposito.
MG chairman Grant Davies could not confirm the meeting.
"We are always having discussions with people about various matters," Mr Davies said.
"But the Leitchville plant isn't for sale."
Murray Goulburn decided a fortnight ago to mothball its Leitchville plant, situated 50km northwest of Echuca , as a result of a milk supply drop of 1.25 billion litres since 2002.
Up to 80 staff were made redundant. With a population of 271, the news has shattered the small community.
Mr Esposito said his company had been looking to add a cheese processing facility to its portfolio and he preferred to make use of an established factory rather than build a new one.
"We were going to build a factory somewhere in Victoria anyway," he said.
"But (at Leitchville) there is an opportunity to keep one open."
Mr Esposito said selling the factory would benefit MG suppliers.
"Farmers paid a lot of money to have that factory built or purchased. Why shouldn't they see something for the closure of the factory?" he said.
UDP currently collects 30 million litres in the Leitchville area and would search for more if it could secure use of the processing facility.
Mr Esposito estimated UDP would need to increase milk supply "five-fold" to fill the Leitchville site.
However, he said given the opportunity, he could successfully source enough milk to run the factory and maintain jobs in the community.
"If a deal could be achieved we would like to think we could re-employ many of the employees who lost their positions," he said.
