Global nutrition group Glanbia is moving forward with plans to exit the dairy business in Ireland, signing agreements to sell its 40 per cent holding in Glanbia Ireland for €307 million.
The food group announced the plans last month, saying it would sell the stake to Glanbia Co-op, which is owned by farmers who supply it.
The move would allow Glanbia to concentrate on food ingredients and sports nutrition.
Glanbia said on Wednesday it had signed binding legal agreements for the deal, which must be approved by Glanbia’s shareholders, co-op members and regulators.
Following the completion of the deal, the name of both the dairy co-op and Glanbia Ireland will change. Costs of €8 million related to pension obligations and separation and rebranding costs will be funded by the group.
The proceeds from the sale will be mainly invested in growth opportunities, with 50 per cent of the proceeds being returned to shareholders through a share buyback.
In a separate filing to the stock exchange, Glanbia said it would begin a share buyback programme of up to €50 million.
“Glanbia will deliver strong operating cash flow this year while continuing to invest in growth opportunities and shareholder returns,” said Siobhán Talbot, group managing director. “In line with our capital allocation policy, today we are launching a new share buyback programme of up to €50 million given the continued strong cash performance of the business in 2021.”
The programme is expected to run until May.
