Farm Ireland

Thursday 22 February 2018

Deal will give 'more control' to farmers claim Glanbia

Glanbia chairman Henry Corbally
Glanbia chairman Henry Corbally
Claire Mc Cormack

Claire Mc Cormack

Dairy farmers will have greater access to "direct income streams" if farmer shareholders support the creation of Glanbia Ireland, chairman Henry Corbally has said.

Last week, Glanbia co-op announced that it has signed a binding legal agreement with Glanbia plc to establish a new joint venture to be known as 'Glanbia Ireland'.

The new entity, which is still subject to shareholder approval, will combine Glanbia Ingredients Ireland, Glanbia Consumer Products and Glanbia Agribusiness, as a joint venture - 60pc owned by the co-op and 40pc owned by the plc.

The co-op proposes to pay €112m to acquire the 60pc shareholding in the plc.

Co-op shareholders will be asked to vote on the proposal at a special general meeting (sgm) in Punchestown on May 18. The proposed deal, which is understood to have the strong backing of the food group's board and representative structures, will also be subject to approval by Glanbia plc's shareholders via an extraordinary general meeting (egm) on May 22.

Speaking ahead of company's agm with up to 200 shareholders in Kilkenny, Mr Corbally, chairman of Glanbia Co-op, described the new joint venture as "a positive move" for farmers.

"It is a very exciting and a very positive move back into more control by farmers. It is part of the progression that Glanbia co-op have been on over the last number of years.

"The flow of profits from these businesses can be channelled to farmers much quicker than through the plc. It will offer a much more direct income stream for farmers," he said. The co-op also confirmed plans to "spin out" a further 5.9 million shares in Glanbia plc to members and add €40m to its members' support fund. The value of the share "spin-out" is an estimated €100 million.

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"We feel that is a reward for farmers who have invested in this co-op for a long number of years and who have shared in the successes that the plc has brought them," he said.

Mr Corbally is encouraging all members to familiarise themselves with the proposals which he says will be available "first hand" at upcoming shareholder meetings nationwide, ahead of the vote.

Meanwhile, last week Glanbia plc also said it delivered good revenue growth in the three months up to April 1, with total group revenue up 9.6pc on a reported basis and almost 8pc on a constant currency basis compared to the same period last year.

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