Pitches are due this week, with a decision expected in September. The winning agency will take control of the account in January 2011.
The account covers media-planning and buying activity for Arla's key dairy brands in the UK, including Anchor, Cravendale, Lurpak, Lactofree, Apetina and Castello, in addition to Arla's leading dairy brands in Europe.
The pitch does not affect relationships with Arla Foods UK's current advertising agencies, which include Wieden & Kennedy, CHI and Partners, and AMV BBDO.
In April, Anchor Butter launched a £10m TV ad campaign designed to underline the brand's credentials as Britain's oldest butter spread.
The TV ad, created by CHI & Partners, featured cows working in the Anchor dairy, and carried the tagline "Made by cows since 1886".
In May, Mother scooped the global ad account for Castello and a position on the Arla roster, following a pitch against three undisclosed agencies.
The agency has been asked to produce a campaign that will break in October across TV, print and digital channels in markets including the UK, Germany, the US, Canada, Australia and Russia.