Kerry Group move closer to buy out of Newmarket Creameries

A Co Cork creamery has approved a rule change that will allow a buy-out by Kerry Group.

At a Special General Meeting of Newmarket Co-operative Creameries Limited last night, 81% of shareholders voted in favour of the proposed rule change which will allow Kerry Group to proceed with an offer to buy the entire issued share capital of Newmarket for a price of €421 per share.

A vote of two-thirds of the attendance at the SGM was required to carry the motion.

Up to 439 members voted which is 88% of the shareholder base with 357 members voting in favour and 82, or 19%, against, and no abstentions.

The offer will be subject to acceptances from shareholders with 66% of the shares in Newmarket.

Kerry is intending to acquire all of the issued share capital of Newmarket. The transaction will also need regulatory approval.

The Kerry offer values Newmarket at a total of €33m including a bank debt of €5.6m and transaction costs of €800,000.

On completion of the proposed transaction, Newmarket shareholders would receive €26.6m and a further consideration that would be receivable on the sale of Newmarket Windfarms.

Newmarket has an annual manufacturing capacity of up to 35,000 tonnes of cheddar cheese each year.

The creamery had annual turnover of €56.6m in 2009.