The Irish Agricultural Wholesale Society has effectively ended its relationship with IAWS plc after placing one million shares in the company.

The placing, made on Monday, raised about €12 million for the society, which is led by former IAWS chief executive Philip Lynch.

Mr Lynch recently launched plans to change the society into a body corporate that could eventually be floated.

Monday's sale leaves the society with 11 million shares in the plc, exactly the number it has promised to allocate to its 50 individual co-op members over the next few months.

This will raise the combined holdings of the co-ops to about 15 per cent of the plc's shares, while the society itself will have no shares in the plc.

The society's exit from the plc will be followed by Mr Lynch's retirement as chairman of the IAWS group. Mr Lynch announced his intention to retire from the chairmanship last month.

At that time, he noted that the society was planning "to avail of further growth and expansion opportunities in the environment, energy and services sectors".

The society already has a 26 per cent shareholding in existing infrastructure company NTR and is known to be in acquisitive mode. It is currently contemplating a takeover move on waste management firm Oxigen.

The funds raised on Monday, when added to €17 million raised in a similar placing last week, will add to Mr Lynch's firepower in this regard.

The relationship between the society and the plc dates back to 1988, when the IAWS group was floated.

At that stage, the society held 66 million shares in the company.

The society was formed in 1897 as a wholesale arm for the then burgeoning co-operative movement.

Shares in IAWS plc closed six cent lower at €12.10 last night.