Member of Glanbia’s co-op vote to cut stake in plc
Move is designed to free up €238 million at a time of significant expansion in dairy sector
A Glanbia worker at its Belview plant in Co Kilkenny.
The move will see approximately €238 million being made available to members at a time of significant expansion in the dairy industry with the lifting of milk quotas.
The proposals, passed at a special general meeting of the co-op at Gowran Park Racecourse, Co Kilkenny, include the transfer, via a share spin out, of 10 million Glanbia plc shares, valued at approximately €170 million, to members.
About half the group’s 16,000 members stand to gain around €17,000 from the plan.
However, it remains to be seen how many will take the option of cashing in their shares given the strong performance of the company’s stock in recent years.
The proposals, which will reduce the society’s stake in the plc from 41.4 per cent to 36.5 per cent, will also see the establishment of a €68 million members’ support fund through the placement of four million Glanbia shares back on the market. The fund is intended as a safety net during periods of low dairy prices.
Members also voted to initiate a share buy-back plan which will see up to three million shares in the society being made available to prospective members.
Currently, about 900 suppliers, mainly in the south east, are not members of the society and therefore do not benefit from the various support schemes available.
Liam Herlihy, chairman of Glanbia Co-operative Society, said: “Many of our members are in a period of expansion and they clearly felt that this is an appropriate time to make some of the value that has been built up in the society available to members which will give them both security and resources for growth.”
“It is equally an opportunity to recognise the members who have built up the Society over many years,” he said.
The society’s board said it would retain the discretion to reduce the group’s in Glanbia to 33 per cent in the future.