Kerry Co Op Shares

has to be more than that.. 350million.. 15% of 1.4billion is 210million… need another 140million… milk pool is 1billion litres.. 1c per litre is only 10million per year.. thats 50million.. wheres the other 90million coming from?

Kerry group is expecting a dividend of 7.5 million on the 30% they will still hold. The equivalent for which Kerry coop investment is 17.5 million the 1 cent levy gives you a total of 27 million

150 million borrowed at 4.5% over 8 year would be repayments of a bit less than 25 million per year. It could be carried out by leveraging within Kerry Daries itself. Not sure how much existing debt the company has.

From it's Company report Kerry co-op has about 20 million in cash reserves. That woukd mean total borrowing required of about 120-130 million. If you say it fast it's not too bad

The processing infrastructure is held together by good intentions and cable ties apparently, plc has purposely not been maintaining/upgrading it as they thought they'd of got shot of it at this stage....

When you see the money tipp co-op spent upgrading their plant and issues/cost over-runs, it would pale in comparison to what the above could potentially swallow -up

I thought they had a way more cash in bank...they must have spent a lot the last few years....I suppose they'll keep the latest dividends from Kerry plc to top it up ..…

I just love the guys that say how much better than us the farmers were in the 70's to build up the Co-Op.

In the first place you can only exist in your own era and not be judged against completely different circumstances.

Also if those great men didn't sell the whole thing off to the stock market then we wouldn't have to buy the whole thing back now again.

in response to Cap.in.hand

have you Co-op shares..?? do you get the annual report in the post every year… have you looked through the accounts?? our Co-op board would put our Government to shame when it comes to squandering money… as much as the childrens hospital will cost.. at least there will be something to show for money spent… co-op board are spending money and have NOTHING to show for it… but you can be sure they have lined their own pockets for our benefit of course

Well there is no doubt that if the whole thing was shut down in the morning trucks would roll in from other processors and your milk would still be collected.

As regards the farmers having sold the milk processing in the first place, a lot of additional wealth was created on the back of that decision. But that is not much consolation to a young dairy farmer with no PLC shares.

You must remember that the Kerry CoOp board's loyalty will always be to the CoOp, whether farmers benefit from is existence going forward is another matter.

Maybe so. Milk suppliers haven't been asked. All we know is that we are out of contract in 2026. Not that the contract means anything, because kerry have already broken their contractual commitments.

They did not sell it they floated it on the stock exchange and created the largest Irish agri company. As years went by they recieved significant returns on there investment and many still have significant PLC holdings outside the Co-op structure. At present an orginal one pound co-op share has 6.15 plc shares linked to it with a value of nearly 600 euro. I think some orginal dispersals saw plc shares handed out but no co-op shares cancelled. Along the way some dairy farmers got co-op/plc shares related to there milk production in particular years.

Even at today's valuation the Kerry daries is worth only a fraction of what the Co-op holding in the PLC is worth about 1.7 billion, however a significant amount of co-op shareholders are no longer milk producers and do not want to invest in the new dairy business.

A compromise has been reached releasing about 80% of the Co-op value back to all shareholders and reinvesting the remained into buying Kerry Daries which some milk producers think is crucial. However it entails a contribution from dairy farmers.

Every dairy farmer will have to look to see if its in there interest. For some former GVM suppliers and suppliers who transfered in to supply milk to Kerry from Clare and Limerick( many of these did it to access quota during the 80's and 90's) and do not have significant co-op holdings, these also have more options to transfer to another milk processor it may not seem an attractive proposal but the lad milking cows in Dingle and Cahirciveen have not got those transfer options.

Will these new shares in this new company have a value and could they be traded in the grey market like before, we don't know yet how many shares we are going to get and what value they will have rough estimate that a lad with 100 Kerry co op share will be giving away 15 and that times 6.25 that's close enough to 9 K invested in new company at today's Kerry group price

What this giving away 15 shares in every 100 co op shares about?

Well I think the present Dairy Ireland management will be coming with it. So I don't think it will mean good times for farmers. The bottom line will be more important for them.

For anyone that might be daydreaming about trying to get this JV voted down - I’d like to share my own personal experience

In 2019 Kerry Co-op came up with the “cash for shares” scheme. To summarise you’d to pay up to 58% income tax, PRSI, USC on the sale of your shares.

You got no PLC shares, just a cheque and the co-op sold the shares and when you applied for the scheme you’d absolutely no idea what price you’d get for the shares.

The board kept back 0.22 of each co-op share and before the vote refused to tell us what plans they had for that “haircut money”, there was talks of renewable energy etc which didn’t fill me personally with hope considering there was directors at the time saying they were going to borrow hundreds of millions against the whole lot of the PLC shares held by the co-op for an “exciting new project” they had in mind.

Ultimately only 7% of shareholders ever took part in the “cash for shares” scheme, that number speaks for itself. I personally literally did absolutely everything humanly possible to have the scheme rejected. I felt it was a very poor deal and if we took that then the board would have said “the shareholders voted for this so it’s what they wanted” so I felt it was important we voted it down.

In the end despite it being a poor deal and a massive backlash to the extent that the chairman at the time stopped chairing the shareholders meetings that were held before the vote (cos of the stick he was getting) they still managed to get 65.9% support and I only beat that chairman we had at the time by 17 votes. I personally was responsible for him being the first kerry co op chairman in 5 decades that got beaten at an AGM in a shareholder vote.

In conclusion, despite the 2019 “cash for shares” scheme being a poor idea, offering a reduced share ratio, talks of colossal money being borrow for a mystery investment and to cap it all off - up to 58% tax, they still managed to only lose by 17 votes.

This time it’s a tax free spin out of 85% & people will be getting 1 “new share” for each 1 current kerry co-op share they hold & a 5.4c/L of a payout on the arbitration debacle. I ask anyone who thinks this is going to get voted down - do yourselves a favour and don’t bother going back to Killarney on the day of the vote, stay at home and spare your diesel that day. Alternatively I’d wager a bet with any of those of you who believe this JV will be voted down. When 65.9% of people voted to pay income tax on their shares you can be beyond certain that no matter what at least 80% no matter what will vote for this tax free spin out

What is the 5.4c/l paid on. Is it on every litre supplied from 2020 to 2024. Or 2015 to 2024?

No Castlekeeper. I’m not spinning. You don’t understand it. The average shareholder owns about €110,000 worth of shares and are in their 60’s or 70’s. They can pass on those shares to their kids and the children will each stay well below the €400,000 capital acquisition tax (inheritance tax) threshold. The kids can then sell those shares and pay absolutely zero tax whatsoever on them. If you don’t believe me then ring IFAC tomorrow morning and have them explain it to you. I’m right. The average shareholder will just be willing the shares to their kids, don’t think you’ll see many fellas buying sports cars out of the shares.

In liquidation there’s 1/3 of the shares gone immediately in tax. When you lose 1/3 of anything it’s hard to come back from that.