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Tirlán Co-op has announced plans to spin out Glanbia shares worth €239m to its members, subject to approval at a special general meeting.

The dairy co-op is required to hold the special general meeting of its shareholders in order to approve a proposed rule change, which would allow the co-op’s board greater flexibility in managing its investment in fellow dairy and nutrition company Glanbia.

John Murphy, chairperson of Tirlán Co-op, explained that currently, the board of Tirlán cannot reduce the co-op’s shareholding in Glanbia below 17%, necessitating member approval to amend this rule.

If approved by members, the rule change will facilitate the release of €239 million of value to members through a spin-out of 15 million Glanbia shares, based on Glanbia’s closing share price of €15.90 on 28 August 2024.

This would be worth approximately €7,013 for every 1,000 shares that a farmer currently holds in Tirlán Co-Op, or €24,604 to an average active Tirlán Co-Op member.

It is expected that, should the rule change be approved at the forthcoming SGM, the spin-out to members would occur in the second quarter of 2025.

Murphy commented: “As a board, we firmly believe that now is the right time to provide our co-op with greater flexibility to better manage our financial investments. Our objective, over time, is to diversify and to target increased farmer returns over the long-term to meet the needs of our members.”

He added that the key focus is on maximising farm returns through payments for milk and grain, as well as targeting the payment of a strong co-op dividend, allowing the co-op to reward members now and into the future.

“We have built a strong co-op, and now is the time to help future-proof it for this generation and generations to come,” Murphy concluded.

Tirlán Co-op is valued at more than €1.7 billion, with a significant proportion of its value concentrated in its 28.9% shareholding in Glanbia. Since 2013, Tirlán (previously Glanbia co-op) has spun out 48.6 million Glanbia shares with a current value of €772 million to its members.

Seán Molloy, CEO of Tirlán Co-op, said that the co-op will be engaging with its representative structure in the coming weeks on the proposal, and encouraged members to attend a series of information sessions.

“Our farmer-facing team and co-op office staff are also available to provide information to members,” he added. “We will write to all eligible members in the coming days with details on how to register and vote at the forthcoming SGM.”

The SGM is set to be held in a virtual format in accordance with the co-op’s rules.

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