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Glanbia Ireland to be a strategic joint venture

Glanbia chairman Henry Corbally and Group Managing Director Siobhán Talbot have confirmed that Glanbia Co-op shareholders will vote in Punchestown on Thursday 18 May on series of proposals, including the formation of a new Glanbia Ireland joint venture with Glanbia plc. Picture: Jason Clarke

Glanbia Ireland will be a new strategic joint venture 60% owned by Glanbia Co-op and 40% owned by Glanbia plc



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26 April 2017

  • Glanbia Co-op and Glanbia plc complete negotiations and sign binding legal agreement
  • Co-op shareholders will vote on a series of proposals at a Special General Meeting in Punchestown Event Centre on Thursday 18 May
  • Glanbia Ireland will be a new strategic joint venture 60% owned by Glanbia Co-op and 40% owned by Glanbia plc
  • Glanbia Co-op also proposes a €100m* “spin-out” of Glanbia plc shares and the creation of a €40m Member Support Fund


Glanbia Co-operative Society (Glanbia Co-op) announced today that it has signed a binding legal agreement with Glanbia plc to establish a new joint venture to be known as Glanbia Ireland.

As announced on 22nd February, Glanbia Co-op proposes to pay €112 million to acquire a 60% shareholding in the plc’s Dairy Ireland division, which consists of Glanbia Consumer Products and Glanbia Agribusiness.

Glanbia Ireland will combine Glanbia Ingredients Ireland, Glanbia Consumer Products and Glanbia Agribusiness, as a joint venture; 60% owned by the Co-op and 40% owned by the plc. This builds on the successful Glanbia Ingredients Ireland (GII) joint venture established in 2012.


Glanbia Co-op has also confirmed proposals to distribute by way of “Spin-out” c.5.9 million shares in Glanbia plc to all members of the Co-op and to create a €40 million Member Support Fund. 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 17th February 2017.

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*.

Subject to Member approval, the Board of Glanbia Co-op proposes to allocate up to €40 million of its resources to a Member Support Fund. This will be 50% funded through the sale of Glanbia plc shares with the balance from Co-op resources.

Payments from the Fund will be in the proportion of 75% patronage to active members and 25% Special Dividend to all Members, with the nature and timing of any payments at the discretion of the Glanbia Co-op Board.

If the proposed transaction is approved by Members, Glanbia Co-op will fund the acquisition of 60% of Dairy Ireland and part fund the €40m Member Support Fund through the sale of c.8.9 million Glanbia plc shares (equal to 3% of the issued share capital of the plc).

Today the Co-op holds 36.5% of the issued shares in Glanbia plc. If all of the proposals above are approved the Co-op would own 31.5% of the issued share capital in Glanbia plc.

These proposals by the Board of the Co-op are subject to Member approval and will be voted on by eligible Members at a Special General Meeting (SGM) of the Co-op which will take place at Punchestown Event Centre on Thursday 18 May.

All of these proposals have the unanimous support of the Board and Council of Glanbia Co-operative Society, who recommend them to Members for approval.

The Chairman of Glanbia Co-op Henry Corbally said: “The proposed creation of Glanbia Ireland is an exciting development for Glanbia farmers. It brings the strong portfolio of Glanbia’s Irish dairy and agribusiness assets into majority Co-op ownership while building on the strong partnership with Glanbia plc. I would encourage all Members to familiarize themselves with these proposals and to attend our SGM in Punchestown Event Centre on 18 May.”

Commenting today, Siobhán Talbot, Group Managing Director of Glanbia said: Having established 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 standalone 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”.

Approvals and conditionality

The Co-op Board will seek the approval of eligible members present at the SGM by a simple majority for the proposal to create Glanbia Ireland.  If the necessary approvals for the creation of Glanbia Ireland are secured, the transaction is expected to be completed by mid-year.

If this initial proposal is approved by Members, Glanbia Co-op will also hold a separate vote on related proposals which will require not less than a two thirds majority vote of eligible Co-op members present, including two-thirds of members classified as active milk suppliers. Those proposals are;

  • The sale of up to 3% of the issued share capital in Glanbia plc to finance the proposed transaction and part finance a proposed Member Support Fund;
  • The spin-out of 2% of the issued shares of Glanbia plc currently held by Glanbia Co-op directly to its members on a pro rata basis based upon their individual holdings in the Co-op.;
  • A rule change allowing the Board of Glanbia Co-op the discretion to further reduce the Co-op’s  shareholding in Glanbia plc to 28%, as well as requiring further member approval for any future proposal to reduce the Co-op’s shareholding in Glanbia plc below 28%.

The proposal to create the Member Support Fund, which is linked to all of the above proposals, will require the approval of eligible members present by a simple majority.

It is further proposed that all future dividends paid by Glanbia Ireland to the Society will be set-aside for distribution to active Members, which will require the approval of eligible Members by a simple majority.

The Proposed Transaction will also be subject to approval by Glanbia plc’s shareholders via an extraordinary general meeting (EGM) on May 22.

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