Irish food group Glanbia has moved a step closer in its bid to sell a stake in its domestic ingredients business.
Glanbia said it has signed contracts with its majority shareholder, the Glanbia Co-operative Society, to run what it said is the largest dairy ingredients supplier in Ireland.
The plan, first announced in August, will see Glanbia sell a 60% stake in the ingredients unit to the co-op.
Glanbia's group managing director John Moloney said the deal, which will be voted on by the co-op's members next month, will help the Irish company "continue its successful international growth strategy and to maximise value for all shareholders".
The group also has operations in the US cheese sector and supplies ingredients to companies including infant formula firms, cereal manaufacturers and sports products for athletes.
Co-op members are set to vote on the joint venture plan on 13 November.
Show the press release
AGREEMENT REACHED TO ENTER INTO A NEW DAIRY PROCESSING JOINT VENTURE WITH GLANBIA CO-OPERATIVE SOCIETY LIMITED - SUBJECT TO SHAREHOLDER APPROVAL
23 October 2012 - Glanbia plc ("Glanbia"), the global nutritional solutions and cheese group, is pleased to announce that, subject to relevant shareholder approval, the Group has signed contracts with its majority shareholder, Glanbia Co-operative Society Limited (the "Society"), to enter into a 40% (Glanbia) : 60% (Society) joint venture in respect of Dairy Ingredients Ireland (the "Joint Venture transaction"). This agreement follows the announced signing of a memorandum of understanding between the two parties on 29 August and is a further step towards the completion of the transaction. Details of the required shareholder approval processes are set out below.
Commenting, John Moloney, Group Managing Director of Glanbia plc said:
"At this point in our development we face clear strategic choices as we approach a post quota era. The proposed new Joint Venture is based on an existing, well invested and profitable international dairy ingredients business. This creates a strong platform from which to grow milk volumes and to capture the benefits arising from increased milk production and processing, post the abolition of milk quotas. The Joint Venture will ensure a continuation of strong and complementary links between the plc and the Society within a structure that better accommodates the strategic interests of Society members. It also enables Glanbia to continue its successful international growth strategy and to maximise value for all shareholders."
Original source: Glanbia
