Dairy co-ops suffer €100m hit as investment value plummets
Published 13/06/2011 | 05:00
IRELAND and Britain's biggest dairy co-ops have seen more than €100m wiped off the value of their investment in the One51 group since the shares first traded in 2007.
The Kerry Group is shouldering the biggest losses, with the value of its shares down by more than €40m.
Kerry Co-op Creameries' €37m worth of stock in 2007 is today worth just €6.6m as the share price has drifted to 90c.
Kerry Group Services acquired a further 2.7 million One51 shares in 2008 when the share price was just below €5. That stake was valued at €4.5m but is now only worth €1.4m.
The co-ops own the majority of the investment group, accounting for about 52pc of the total stock acquired when the company was formed following a restructuring of the Irish Agricultural Wholesale Society (IAWS) in 2006.
As part of that process some of IAWS assets were sold. Shareholders were given One51 shares, valued at €5 each, in exchange for their stock when they began trading on the 'grey' market in 2007. All will be writing off their huge losses.
After the Kerry Group, the Fane Valley Co-op in Armagh is a big shareholder that is nursing losses of close to €8m on its One51 shares. The Merrion Co-op Society's stake is down €6.6m, while the Manchester-based Co-operative Group's shares have fallen from €8m to €1.5m.
Drinagh Co-op in Cork is also a big shareholder and its stake has fallen by more than €3m, while Leckpatrick Dairies' stake is down from €3.6m to €643,702.
Others sitting on big losses include: Lee Strand Co-op in Tralee, which has seen its shares fall from €2.85m to €431,183; Golden Cow Dairies, which has lost almost €2m; and Connacht Gold Co-op in Sligo, which is down €1.8m.
Golden Vale's shares, which are held on behalf of marts around the country, are worth close to €2m less than when they first traded in 2007.
The shares of Ballyroe Co-op in Bandon have fallen from €2.2m to €391,436, and Lisavaird Co-op in Clonakilty has lost €1.3m. The value of Bandon Co-op's investment is down €1.2m.
Co-ops in Northern Ireland -- which have seen 80pc of their investment wiped out -- include: the West Ulster Farmers in Fermanagh, which has lost €727,406; the Dungannon and District Co-op, which is down €650,945; and the Drumquin Co-op Livestock Mart in Tyrone, whose shares have fallen from €743,520 to €133,834. The South Armagh Farming Enterprises in Newry has seen its shares fall from €565,560 to €101,801, while the Northern Counties Co-op in Derry is nursing a €193,245 loss.
One51 staff also have a substantial shareholding that has shrunk by almost €3m.
A number of co-ops purchased shares after the 2007 flotation and some have acquired the stock at current low levels. Lakeland Dairies in Killeshandra, Co Cavan, for instance, purchased more than 4.6 million shares for around €1.10 each and are down from €5.1m to €4.2m.
The Wexford Farmers Co-op, Enniscorthy, which has lost €1.3m on its original shareholding, has been one of the biggest buyers of the stock recently. It took almost 700,000 shares at a price of €1 each, which are now worth a total of €607,342.