Glanbia Co-op takes full ownership of Glanbia Ireland
Glanbia Co-operative Society Limited (“Glanbia Co-op”) has confirmed the completion of the transaction to acquire full ownership of Glanbia Ireland DAC.
This This follows the overwhelming approval of the proposed transaction by Glanbia Co-op shareholders at a Special General Meeting on 17 December 2021.
Glanbia Ireland previously operated as a strategic joint venture, 60% owned by Glanbia Co-op and 40% owned by Glanbia plc.
Ireland’s leading dairy processor, Glanbia Ireland, is a €2 billion, integrated agri-food and nutrition business, with world-class dairy and grain processing assets and an award-winning portfolio of brands including Avonmore, Kilmeaden and GAIN Animal Nutrition.
John Murphy, Chairman of Glanbia Co-op, said: “I am very pleased to confirm to Glanbia Co-op Members that we have successfully completed our acquisition. Last December, our Members voted overwhelmingly in favour of taking 100% ownership of the world-class processing assets closest to our farmers’ interests. The new ownership model will support Glanbia Co-op’s ambitions to build one of Europe’s leading Co-ops, with greater flexibility to support Members, pursue new opportunities and add value to our farmers’ high quality milk and grain through innovation.”
Commenting today, Jim Bergin, Chief Executive of Glanbia Co-op said: “We are very ambitious for this great business and are excited by the opportunities presented by this natural evolution to a pure Co-op model, with the added dimension of our investment fund.”
“Our excellent workforce and leadership team are looking forward to launching our new identity, logo and branding later this year. I believe that this is an exciting opportunity to position our Co-op strongly as a new ambitious organisation on global markets.”
As previously announced, Glanbia Co-op is paying €307 million to acquire Glanbia plc’s 40% shareholding in Glanbia Ireland.
As part of the transaction terms, it was agreed that Glanbia Ireland would not be required to pay the dividend payable to its shareholders in 2022 in respect of the 2021 financial year and up to the closing of the transaction.
In order to fulfill its commitment to its Members to pay the “best possible milk and grain price”, the Board of Glanbia Co-op has agreed that Glanbia Ireland will create a Milk & Grain Price Provision of €43 million, which will be paid to suppliers over the next 12 months as the business transitions to a more flexible profit model.
Funding of transaction
On 20 January 2022, Glanbia Co-op announced that it had completed the funding arrangements for the transaction, with the placement of 5.75 million ordinary shares held in Glanbia plc (equivalent to approximately 2% of Glanbia plc’s issued share capital) at a price of €12.25 per share. The share placement raised approximately €70 million for Glanbia Co-op.
On the same date, Glanbia Co-op also confirmed that it had raised €250 million through the launch of an Equity-Linked Exchangeable Bond. The five-year Exchangeable Bond is linked to a pledge of approximately 15.1 million Glanbia Plc shares (5.3% of the issued share capital).
Spin-out of Glanbia plc shares to Members
In November 2021, Glanbia Co-op also announced its intention to transfer, via Share Spin Out, 12 million Glanbia plc shares to the circa 11,200 Members of the Society. The spin-out is expected to be completed this summer.
To align with the transaction completion date, Glanbia Ireland is extending its accounting year-end (on a one time basis) from its usual 12 month period ending 1 January 2022 to a 15 month period ended 1 April 2022. Its next accounting period will be a 9-month period to 31 December 2022.