Glanbia Co-op’s proposed acquisition of Glanbia plc’s €1 billion Irish business could lead to direct farmer ownership of the country’s largest milk pool.
The proposal, which is currently being discussed between the Co-op and the plc, has been described as “a unique opportunity to transform Glanbia” according to a plc spokesperson.
For its part, the Co-op, which currently owns just under 55 per cent of the plc, believes the move would provide a greater level of flexibility to cope with “continuing volatility” in the milk price.
In a statement issued on Friday last, the Co-op revealed: “Fundamental changes in the global dairy industry, the reduction in EU farm supports and the future elimination of quotas has dramatically changed the environment for farmers and put pressure on farm incomes.
“The Co-op board now believes that returning the Irish businesses of most relevance to farmers to Co-op ownership is the way forward. It will put Co-op members firmly in charge of their own destiny.”
From the plc’s perspective, such a decision would “increase the Group’s focus on international nutritional ingredients and cheese, significantly improve financial flexibility and enhance development of its successful growth strategy”.
Welcoming the discussions, the Irish Farmers’ Association (IFA) said that the potential green-lighting of such a transaction would lead to greater consolidation and cost efficiency within the dairy sector.
See The Munster Express newspaper for full story.
