The new company, called AarhusKarlshamn, hit the Stockholm Stock Exchange this morning in its first day of trading.
The merger ends months of speculation as to the fate of the Danish cocoa butter replacer firm Aarhus United.
The move also reflects a trend among businesses in today's archly competitive food industry climate to consolidate for strength.
The rising power and ongoing growth of the multiple retailers is putting constant pressure on ingredients companies to keep up with the pace, deliver products at competitive prices and guarantee supplies.
A gain in critical mass through consolidation, and economies of scale, are two of the only routes open to them, providing sufficient leverage to meet the challenge.
Last year the majority shareholder in Aarhus, Malaysian firm United International Enterprises (UIE), announced it would sell its 46 per cent slice of the firm.
Under Danish law, whoever bought the UIE majority chunk would have to bid for the remaining shares, meaning in reality that the entire company was up for sale.
Confirming consolidation for the European fats business, the company's shareholders voted recently to merge with Sweden's Karlshamns.
As Scandinavia's number one fats and oils company, from the outset Karlshamns was mooted as the natural frontrunner for the Aarhus business: a combination of the two businesses creating a strong market player in the competitive area of speciality fats for confectionery and food industries.
Combined, last year Karlshamns and Aarhus pulled in over €1 billion in sales, €75 million in EBITDA, and together they have about 2200 employees.
Its products are used in the food industry, the chocolate confectionery industry and in the cosmetics industry.
"AarhusKarlshamn will be a leading company within the production of environment-friendly, highly refined vegetable oils", the freshly formed firm said in a statement today.
Jerker Hartwall, former group CEO in Karlshamns, has become the managing director and group CEO of the new firm, while Aarhus United's group CEO Erik Højsholt will be the chairman of AarhusKarlshamn.