independent

Saturday 19 April 2014

Thousands of farmers to receive Kerry Co-Op shares windfall

Stan McCarthy: chief executive of the Kerry Group
Stan McCarthy: chief executive of the Kerry Group

SOME 12,500 farmers who hold shares in Kerry Co-op are in line for a windfall of shares worth on average more than €21,000 this summer.

The Kerry Co-op will distribute shares it holds in Kerry Group – the international food group it part owns – worth more than €270m to its farmer shareholders in July.

That equates to every one of the co-op's farmer shareholders receiving shares worth, on average, some €21,864.

Some will receive more because they hold more co-op shares. The farmers don't traditionally sell these shares although they may use them to finance farm improvements or other financial needs.

The co-op is reducing its stake in the Kerry Group from 17.1pc to 13.7pc. The last time Kerry co-op shareholders in Kerry Group enjoyed a similar windfall was in 2011.

At that time more 1,600 Kerry Co-op members who held Kerry Group Shares voted by a margin of 80pc to allow a share transfer. It saw them exchange a quarter of their shares in Kerry Group and dilute the percentage of its ownership in the food giant to below 20pc.

On the day of the vote, shares in Kerry Group stood at €29.07, which when multiplied by the 10.1 million shares moving from the co-op to the Kerry Group PLC, amounted to a €290m windfall for shareholders, who would have been entitled to sell, or hold onto the Kerry Group shares as they saw fit.

It comes just weeks after it was announced that more than 16,000 farmers will receive a windfall of shares in a €172m share deal at diary giant Glanbia. While most farmers got shares worth an average of €11,000 each, the 'spin-out' deal has seen some get considerably more.

Glanbia Co-operative Society distributed about 7pc of its holding in Glanbia PLC to its farmers last month. Glanbia, based largely in the south-east, has expanded internationally in the past decade and its lucrative cheese business in the United States is one of its main drivers of growth.

Irish Independent

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