Malting business sale threat to Guinness

GREENCORE has been condemned as an asset-stripping “pack of vultures” by Fianna Fáil TD Seán Fleming, as the food group continued negotiations to sell its malting business to Soufflet Group of France.

He told the Dáil that Soufflet will be the biggest malt processor in Europe and perhaps the world if it adds its 1.5 million tonnes of malting barley capacity to Greencore Malt’s assets in Ireland, Belgium, and Britain, which handle 500,000 tonnes.

He said the deal could threaten 1,500 Irish farms where 130,000 tonnes of malting barley per year has been grown for generations. Deputy Fleming, who represents the Laois-Offaly constituency, was concerned at reports that the malting plant in Athy and depots in Stradbally and Emo in Co Laois could close.

He said it was essential that a supply of Irish malting barley to Guinness continue. “If this link is broken, it could have a knock-on effect for the Guinness operation in Ireland.”

He called on the Government to refer any proposed purchase of Greencore Malt to the EU competition authorities, asserting that a purchase by Soufflet would create a new company that would have too much dominance.

He also wants the Government to call in the Greencore chief executive and demand guarantees on continued growing of malting barley and of malting in Ireland if Greencore decides to sell Greencore Malt and it is approved by the EU.

Fianna Fáil TD for Wexford John Browne said there is a genuine fear among farmers in the south east that a company which purchases Greencore Malt will close down Irish production.

Junior Agriculture Minister Trevor Sargent confirmed the Greencore malting group was formed at the beginning of 2000 by the integration of Pauls Malt in Britain, Minch Malt in Ireland and Belgomalt in Belgium.

He said Greencore is the main purchaser of malting barley in Ireland, but the issue of the sale of the company is a commercial matter and he cannot become involved in any formal way.

Greencore has confirmed that it is considering a number of “unsolicited approaches” for its malt business, which contributed about 20% to its €545.4m turnover in the first half of 2009.

Potential buyers suggested by market experts include the Australian firm Graincorp.