The Daily Star Ireland
Farmers across Munster, who are shareholders in Kerry Co-op, will vote tomorrow on a proposal to repurchase the dairy processing assets of Kerry Group for €500 million.
The deal, which involves the purchase of Kerry Group’s consumer foods and dairy ingredients business, Kerry Dairy Ireland, has several components. In addition to the buyback, the proposal offers Kerry Co-op’s nearly 12,000 shareholders an opportunity to convert €1.4 billion worth of co-op shares into cash, potentially bringing a significant financial boost to the Kerry region and beyond. If approved, the deal could begin to have an impact as early as January.
Should the deal pass, shareholders in Kerry Co-op will exchange their shares for Kerry Group shares, allowing them to trade on the stock market and cash in their holdings at their discretion. This would replace the current reliance on the unofficial grey market or biannual redemption schemes for trading co-op shares.
Kerry Co-op and Kerry Group have always been closely intertwined, though they are separate entities. Kerry Co-op provided the initial investment that led to the creation of Kerry Group, which became a major global success. Established in 1973 to process milk for dairy farmers in Kerry, Kerry Co-op’s journey from humble beginnings to the global success of Kerry Group is remarkable. Today, Kerry Group operates in 36 countries, employs 21,000 people, and generates annual revenues of €8 billion.
The €1.4 billion worth of Kerry Group shares involved in the deal would represent a substantial portion of the returns from the original investment by Kerry Co-op members. In addition to this, another €250 million in Kerry Group shares held by Kerry Co-op will help fund the buyback of Kerry Dairy Ireland.
This vote is a significant moment in Irish corporate history, particularly for the economies of Kerry and Munster. Since its launch in 1986, Kerry Group has been partly owned by Kerry Co-op, which initially held 90% of the business. Today, Kerry Co-op remains the largest shareholder in Kerry Group, although its stake has reduced to 11%, worth approximately €1.7 billion.
Kerry Co-op has 11,906 shareholders, divided into three categories: A shareholders, who actively supply milk to Kerry Group; B shareholders, who no longer supply milk; and C shareholders, who typically inherited or purchased their shares. Only the A and B shareholders—5,577 people—are eligible to vote on the deal tomorrow. Voting will take place at noon at the Gleneagle Hotel in Killarney, and votes must be cast in person.
Since the deal was announced, there has been intense interest, with numerous meetings held across counties Kerry, Clare, Limerick, and Cork. The deal, which includes the buyback of Kerry Dairy Ireland, has stirred up considerable debate. Kerry Dairy Ireland processes over 1.1 billion litres of milk annually and employs 1,500 people. It exports to 58 countries and is responsible for well-known brands like Cheestrings, Dairygold, and EasiSingles.
Supporters of the deal argue it will benefit the region and bring financial rewards, while opponents have raised concerns. The outcome will depend on whether those opposing the deal can gather one-third of the votes needed to block it, as the proposal requires two-thirds approval to pass. The high bar set for the resolution reflects the significance of this decision for the future of Kerry Co-op and the wider region.
