Farmer fury at Greencore malting unit sale
Published 10/03/2010 | 05:00
GREENCORE shareholders have voted to sell the company's malt business, enraging barley farmers and effectively ending the former state-owned company's manufacturing links with Ireland.
Shareholders yesterday rubber-stamped the sale to French agricultural co-op Axereal Union De Cooperatives Agricoles, which will generate around €100m in cash for Greencore as the company concentrates on making sandwiches, quiches and other convenience foods in the UK, US and Europe.
About 600 barley farmers in Carlow, Kildare and Laois have been told that their contracts with Greencore have been ended.
Some farmers tore up their ballot papers before the vote and stormed out of the extraordinary general meeting meeting in Dublin's Westbury Hotel.
Around 100 more farmers picketed the hotel's entrance to object to Greencore's decision to end contracts with certain farmers rather than applying an across-the-board reduction.
"We've been growing malt and barley in our farm for over five generations," shareholder John Ryan told Greencore chairman Ned Sullivan.
Mr Ryan, who has been farming for 17 years, added that he lost his contract after Greencore complained of alleged inconsistencies in the protein in his malt.
Mr Sullivan replied that, while the malting business had generated a lot of money over the years, the company was selling because they wanted to concentrate on making convenience foods.
Greencore chief executive Patrick Coveney said after the meeting that consumer sales had given the company "grounds for optimism" and that the company had seen "decent" sales momentum in the first half of the year.
The deal will generate about €100m for Greencore after expenses, which will be used to pay off some of Greencore's debt, Mr Sullivan said.
Greencore, formed following the privatisation of state-owned Irish Sugar in 1991, has been an unprofitable investment for the early shareowners.
The company's shares, which were sold for the Irish pound equivalent of €1.46 each in 1991, closed at €1.30 in Dublin yesterday. Leading the walkout, Laois farmer Jer Bergin said he had no doubt that the sale would go through, as the banks would ram it through.
Mr Bergin claimed that Greencore was walking out on barley growers in the same way they had destroyed the Irish sugar industry.
He added that Axereal Union De Cooperatives Agricoles should treat farmers more honourably than Greencore had or they "will have a battle on their hands".