Glanbia to sell stake in Nigeria business for €29m....as milk quotas abolished
Published 01/04/2015 | 08:02
Irish multinational foods giant Glanbia is to sell its stake in one of its African operations for approximately €29m.
The news comes on the day that EU milk quotas, which followed on from the EU’s Common Agricultural Policy and the guarantee of milk prices, were abolished.
The company said that the Nutricima plant in Nigeria no longer fits its strategic priorities. Nutricima was formed in a joint venture over ten years ago in a joint venture between Glanbia and UK firm PZ Cussons to supply evaporated milk and milk powder to the local market.
PZ Cussons is to buy Glanbia’s 50pc stake in Nutricima with a cash payment of £21m (€29m).
Nutricima generated profit before tax of approximately £1.3 million in the financial year ended 31 May 2014.
As part of the transaction, Glanbia Ingredients Ireland has entered into a long-term agreement with Nutricima for the supply of dairy ingredients.
Siobhan Talbot, Glanbia's Managing Director, said: "We believe this is the right move for Glanbia at this time. The region remains a significant market for dairy ingredients, particularly enriched milk powders and we look forward to continuing the relationship with PZ Cussons through the new long-term supply agreement with Glanbia Ingredients Ireland."
Glanbia Ingredients Ireland previously said that it would facilitate milk suppliers “in their ambition to avail of the opportunity presented by quota abolition.”