Board of Kerry Co-op ponders options on future spin-out

The board of Kerry Co-op is mulling over a recent proposal tabled for the conversion of co-operative shares into Kerry Group shares for members at its recent meeting during the week.

A motion was put to the board regarding a “future share conversion of some sort” for co-op members.

The board held a meeting on Monday (December 3) at which the proposal was discussed but the matter is still ongoing, according to a source close to the board.

The matter will apparently require at least two further board meetings on the issue and nothing has been finalised yet.

Consultant firm Deloitte had been appointed by the board to determine options regarding taxation and spin-outs.

One proposal offered by the firm was to buy out C shareholders – members who are not actively dairy farming (A) or dormant (B) – in possession of a certain quantity of shares.

On this, the source said: “Legal opinion is you can’t do something to one class of shareholders for the benefit of other class of shareholders.

“One class of shareholders can’t be taken advantage of for the benefit of other classes.

“They can do something that might be of benefit for the company as a whole but you can’t do it for individual classes between each other and that basically means that there would be no compulsory buy-out of C shareholders.”

Options are still under review and will be decided on at a later date.