Glanbia Co-op received a devastating blow this week when farmers narrowly defeated the proposal to buy the dairy division of the company.
At a meeting in Kildalton College in Piltown on Monday some 4,060 farmers turned out to vote on the controversial proposal to sell the division to its 54 per cent shareholder, the Glanbia Co-op.
Although 73 per cent of farmers voted in favour of the deal, it was not enough to pass the sale which required a 75 per cent majority vote in favour of the motion. This was ultimately defeated by just 80 votes.
When the votes were counted on Monday evening it was found that some 2,970 farmers had voted in favour of the purchase of the dairy division, but 1,097 voted against the purchase, which did not give enough of a majority to pass the sale. Some 8,000 farmer co-op members were entitled to vote in the ballot.
A second SGM, planned for May 24, will not now proceed.
Commenting on the result, Glanbia society chairman, Liam Herlihy expressed disappointment at the outcome of the vote, however he said he fully respects the decision of members.
“I am deeply disappointed at this narrow defeat. Achieving the required 75 per cent vote was never going to be easy. It is clear that a significant number of farmers supported full ownership of the Dairy Ireland businesses, but the level of support was just not enough. The board of the society firmly believed and continues to believe that the acquisition was very much in the interest of Glanbia Co-op members. Notwithstanding this outcome we fully accept and respect the result.
“I wish to thank all members for the serious consideration given to the issue, for their attendance at the large number of meetings held in recent weeks and their participation in the democratic process – which is at the heart of our Co-operative.”
Mr Herlihy insisted there was “no plan B” in terms of putting the proposed deal to the co-op members again. While there was no legal impediment to proposing another deal, the company respected the decision of the co-op members. This meant that no proposal would be on the table for “the foreseeable future, the next couple of years”.
Mr Herlihy said the company had assembled the very best team of advisers including KPMG, William Fry, and pension advisers to put the best plan forward to members.
Meanwhile, John Moloney, group managing director of Glanbia plc, said, “We believed this was a compelling and strategic opportunity for both the society and the plc. A lot of work has gone into bringing this proposal to the vote today. We did not undertake this process lightly and of course, it is a big disappointment that it did not receive the necessary endorsement from the members of the society to take the deal forward. While it is important for us now to take some time to reflect on this outcome, we remain very confident of the underlying strength of the group’s businesses.”
