Glanbia plans major US investment

GLANBIA plans to take a 50% stake in the development of a €150 million cheese and whey products factory in Texas which will process over one billion litres of milk a year.

The move should make Glanbia the biggest producer of American-style cheeses in the US by 2008, with 16% of the market.

Glanbia announced yesterday that it is in advanced negotiations with Select Milk Producers Inc and Dairy Farmers of America (DFA) the largest dairy co-operative in the US to build a 150m cheese and whey products facility in the western Texas/New Mexico region.

"This new plant will be 50% owned by Glanbia, with the balance jointly owned by DFA and Select. The proposed project will be funded by way of $35m of equity investment each by Glanbia and DFA/Select (total $70m), with the remainder directly financed by the Joint Venture entity.

"If the project proceeds as planned, commissioning of the new facility is expected in the second half of 2005. Once fully operational, it is anticipated that the new facility will generate sales in the region of $340m per annum and will employ approximately 200 staff. Glanbia will have full responsibility for operations and for sales and marketing of the product stream through its existing structures," Glanbia said in a statement yesterday.

It is expected the new facility will process over one billion litres of milk annually to produce 115,000 tonnes of cheese and 7,500 tonnes of high value-added whey proteins.

Glanbia believes it will eventually become the largest advanced whey facility in the Northern Hemisphere.

Group managing director John Moloney said: "This project will be a significant step forward in the implementation of Glanbia's growth strategy. It will position us as the number one producer of American-type cheddar cheese in the USA and simultaneously build our global position as a supplier of advanced-technology whey proteins to the nutritional sector. We are delighted to partner with DFA and Select on this project."

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