99% of Glanbia shareholders approve plan

Ninety-nine percent of Glanbia plc shareholders have approved a proposal to enter into a dairy processing joint venture.

The decision paves the way for a €164m share payout to farmers next Wednesday.

The decision by the Glanbia shareholders to accept the proposed joint venture had been expected following a vote last Wednesday which saw an overwhelming 71% majority of the farmer-led co-op vote to take direct control of Glanbia plc’s Irish dairy subsidiary.

The final part of the Glanbia plan to create anew debt-free entity, Glanbia Ingredients Ireland, will be put to a vote co-op members at Gowran park next Wednesday and will need a 75% approval rate to get the go-ahead.

Glanbia is offering a €164m sweetener in the form of a share dispersal in an effort to coax three-quarters of voters in to accepting the proposal.

As it stands the deal will go ahead with the Co-op paying €44.5m for a 60% stake in Dairy Ingredients Ireland, which is the current dairy processing arm of the Glanbia.

The acquisition will be funded by the co-op selling 3% of its stake in Glanbia.

Dairy Ingredients Ireland will now become a joint venture, Glanbia Ingredients Ireland, which will focus on preparing for the abolition of milk quotas in 2015 and begin processing milk on Sunday.

If 75% of co-op members agree to the proposal the co-op will sell a further 10% of its Glanbia holdings. If this is approved, 7% of the shares, valued at around €164m, will be distributed to co-op members and the remaining 3% or €70m will be split. €Some 51m will be retained by the co-op, leaving it debt free with €19m being injected in to the Glanbia Ingredients Ireland.