Glanbia Co-op shareholders to vote on new joint venture today

Glanbia Co-operative Society (Glanbia Co-op) shareholders are set to vote on proposals to create a new joint venture, Glanbia Ireland, later today.

All eligible shareholders are being encouraged by Glanbia Chairman, Henry Corbally, to attend the Special General Meeting (SGM) of the co-op, which takes place today at 12:00pm in the Punchestown Event Centre in Co. Kildare.

“Our members are being asked to vote on an important set of proposals that will shape the future of our organisation.

“I would encourage as many eligible shareholders as possible to attend the SGM and make their vote count,” he said.

Glanbia Co-op recently announced that it had reached agreement with Glanbia PLC to create Glanbia Ireland, a strategic joint venture encompassing Glanbia Ingredients Ireland, Consumer Products and Agribusiness.

Later today, members will be asked to approve the formation of this joint venture along with a number of related proposals.

Glanbia Ireland will own consumer and agri brands such as Avonmore, GAIN, Kilmeaden Cheese, Premier and Wexford. With an expected annual revenue of €1.5 billion, it is hoped Glanbia Ireland would be a diversified business majority-owned by Glanbia farmers.

Subject to member approval, the board of Glanbia Co-op also proposes to allocate €40 million of its resources to a Member Support Fund.

The board of the co-op proposes to transfer, by way of a share ‘spin-out’, 2% of Glanbia PLC’s issued share capital – this reportedly equates to approximately 5.9 million Glanbia PLC shares – to all existing members of the co-op.

The value of the share ‘spin-out’ is an estimated €100 million, based on the Glanbia PLC closing share price of €17.13 on Friday, February 17, this year.

This would be worth approximately €6,637 for a member with the average shareholding; for active dairy farmer members the average value of the spin-out would be €10,791 (based on the above share price).

‘A step forward in the right direction’

Meanwhile, Group Managing Director of Glanbia, Siobhan Talbot, has previously described this proposed joint venture as a step forward in the right direction.

“Having established Glanbia Ingredients Ireland (GII) and successfully managed the transition to a post milk quota environment, there is a compelling rationale to combine the Irish businesses and supply chain to create efficiencies and scale.

As a top 10 dairy company in Europe, exporting to over 60 countries, Glanbia Ireland would have the scale to invest in innovation and growth on a stand-alone basis.

“GII suppliers plan to supply 30% more milk in 2020 than in 2016. The financial strength of the Glanbia Ireland business will allow it to fund a €250-€300 million investment programme to 2020, without a requirement for supplier contributions,” she said.