Claims that ineligible voters took part in the first ballot have resulted in an application to ICOS for arbitration on an alleged breach of the society's rules.
In addition, the admission by ICOS that 32 more votes were cast in the first ballot in Gowran Park than there were eligible registered voters has proven seriously embarrassing for both the co-op body and Glanbia.
Glanbia insisted yesterday that tomorrow's confirmatory ballot would go ahead despite the last-minute difficulties. However, the continuing controversy has cast a shadow over the whole process.
Tomorrow's vote, if passed, would see Glanbia Co-op's stake in the Glanbia Plc drop from 51.4pc to 41.4pc. The 10pc is valued at around €230m. Close to €70m is earmarked to provide additional equity for the new dairy processing venture involving both Glanbia Co-op and Glanbia Plc. The remaining €160m is to be spun out to the co-op's 16,000 shareholders in the form of plc shares.
However, tomorrow's motion also includes a rule change. This would see the threshold for key ballots drop from the current 75pc to 66pc. In addition, A2 shareholders would effectively become A1 shareholders.
A1 shareholders are defined as active milk suppliers and farmer traders with Glanbia. A2 shareholders are recently retired milk suppliers or farmers who traded with the co-op.
The dispute on the society's rules centres on the eligibility of A2 shareholders to vote on motions that deal with changes to the society's rules.
A number of farmer shareholders have pointed out that Rule 6 d) (2) ii of Glanbia Co-op prohibits A2 shareholders from receiving notice of a special general meeting where a rule change is to be voted on, or voting on resolutions dealing with rule changes. They contend that votes on rule changes must be confined to A1 shareholders.
The shareholders argue that both the ballot on November 28 and tomorrow's vote are invalid because A2 farmers were informed of the special general meeting and will vote at both shareholder meetings.
At least one shareholder has lodged an application with ICOS for arbitration on Rule 6 d) (2) ii and on the eligibility of A2 shareholders to vote in the two ballots.
However, Glanbia has rejected complaints on Rule 6 d) (2) ii. "The Glanbia Society SGM (special general meeting) held on 28th November in Kilkenny was a valid meeting. Members voted validly in favour of the share spin out and sale resolution and it is expected they will vote to confirm this decision next Wednesday," the co-op stated. Glanbia Co-op has around 1,200 A2 shareholders, of which 800 are believed to have voted in the first ballot.
Meanwhile, serious concerns regarding the procedures followed in supervising the vote on November 28 have been raised following confirmation of irregularities in the count.
ICOS has admitted that the number of admission cards scanned for the Gowran Park meeting was 4,649 but the number of votes cast was 4,681 – a difference of 32.
ICOS chief executive, Seamus O'Donohoe, said it was not known how the mistake occurred but he attributed it to "human error".
"While every effort is made to ensure an accurate procedure, some degree of human error in the process up to the count and minor differences from one stage to the next are not unusual or of undue concern," ICOS said.
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The organisation also refuted suggestions that the problems with the November 28 vote invalidated the ballot.
The proposals were comfortably carried in the first ballot, receiving an 82pc 'yes' to 18.2 'no'. However, the milk supplier ballot was much tighter, with a 'yes' vote of 77pc, or 2pc more than the 75pc required. In terms of votes, the 2pc margin represented just 60 votes.
ICOS has insisted that farmers could have faith in the organisation to oversee tomorrow's ballot. But with the margin between the two sides extremely tight, farmers slammed the performance of both ICOS and Glanbia. One Glanbia milk supplier described the mistakes in the Gowran Park ballot as "farcical" and "a debacle". But a Glanbia spokesperson rejected this criticism."Glanbia is satisfied with the process conducted by ICOS last week. ICOS was appointed to conduct the counting of votes at this SGM and they along with the 12 Glanbia Society member scrutineers unanimously signed off on the process," she said.
Meanwhile, Glanbia chairman Liam Herlihy urged farmers to turn out for next Wednesday's ballot. He said another 'yes' vote would strengthen the co-op.