The Irish protein and nutrition products group confirmed in a stock market statement that the sale to the Glanbia Co-operative Society Limited is now complete.
It noted that the final consideration for the deal is still to be defined, it is subject to the confirmation of actual working capital in the Dairy Ireland business as at the completion date.
The deal terms anticipated that Glanbia Plc would receive €112mln plus an amount equal to 100% of the working capital in Dairy Ireland, paid in new shares of the diary business.
The Glanbia co-op is the largest shareholder in Glanbia Plc, holding 36.5%. It comprises some 14,773 members (which makes it Ireland’s largest co-operative).
Prior to the transaction, Glanbia owned 100% of the Dairy Ireland business which was in turn partnered with the co-op – the PLC owned 40% of the Glanbia Ingredients Ireland DAC (GIID) which produces some 2.2bn litres of milk per year.
It separates the dairy and sports nutrition businesses
Glanbia’s Dairy Ireland mainly comprises the Avonmore branded milk and dairy products, including cheese, butter and cream products. In 2016, the business unit generated €30.7mln of earnings (EBITDA) on €616.2mln of revenue.
Comparatively, the Glanbia Performance Nutrition (GPN) business earned €162.6mln in 2016, up some 20% on the previous twelve month period. GPN sells premium protein and sports nutrition products under brands such as Optimum Nutrition, BSN, Isopure, thinkThin, Nutramino, ABB and trusource.
The divestment of the Dairy Ireland stake is part of a strategic move to separate the Irish food operations from the global sports nutrition business. The transaction includes the pension obligations related to the Diary Ireland business, which at the end of December amounted to €54mln.
Alongside the Dairy Ireland transaction, the co-op is seeking approval for a redistribution of a portion of the Glanbia equity to co-op members. This would see the co-op’s direct shareholding reduce to around 28%.