In a statement, the Kilkenny-based firm revealed its intentions to walk away from Glanbia Ireland, a joint venture between the two parties to focus on Glanbia Performance Nutrition (GPN) and Glanbia Nutritionals (GN).
“Glanbia Ireland has a successful heritage, and for many years we have valued the partnership with Glanbia Co-op in creating a strong business under our joint stewardship,” says Glanbia plc’s Chairman Donard Gaynor. “This is the right time for the Proposed Transaction.”
The Co-op is the right owner to continue the strategic development of Glanbia Ireland for the benefit of the Co-op’s members, and the PLC can continue to maximise the opportunities for its own business in the post-Covid environment, with our focus on health, wellbeing and nutrition.”
A special general meeting of Co-op members is scheduled for the 17 December 2021, where its members are expected to approve the acquisition of the plc’s 40% interest in Glanbia Ireland.
Optimum Nutrition & BSN
Discussing the reasoning behind the move, Glanbia plc said the sell-off was consistent with the PLC’s strategy to focus on GPN & GN, owners of the popular sports nutrition brands Optimum Nutrition and BSN.
Glanbia plc’s emphasis on nutrition has resulted in a spate of brand acquisitions that include Slimfast (2018), Plant Nutrition (2017), thinkThin (2015) and Isopure (2014) which all tap into the need to follow a healthy lifestyle.
The deal would also allow Glanbia plc to pursue strategic joint ventures whilst allowing focus on its “global nutrition strategy as a brand owner and provider of nutrition solutions, serving high growth markets.”
The proceeds from the proposed transaction will be primarily invested in growth opportunities with up to 50% of the proceeds being returned to shareholders via a share buyback.
Early 2022
Further details of the agreement will see the Co-op finance up to 50% of the purchase through the sale of shares it owns in the capital of the PLC, with the balance to be funded through borrowings.
The Co-op intends to transfer via a spin out to its members up to 12 million shares it owns in the capital of the PLC. These proposals will be subject to a Co-op member vote.
The deal is expected to complete in early 2022 subject to appropriate board approvals.
“Today’s announcement represents the next stage of our transformation journey following many years of successful collaboration with Glanbia Co-op as joint venture partners in Glanbia Ireland,” adds Siobhan Talbot, Group Managing Director of Glanbia plc.
“If approved, the Proposed Transaction will continue the alignment of our portfolio to our strategy, which is focused on driving growth through our market leading positions as a brand owner and ingredient solutions provider, playing into strong underlying consumer health and wellness trends.
“We expect to deploy the capital received from the Proposed Transaction in investment to drive further growth and to return capital to shareholders.”