DEAR SIR, More than 20% of A and B shareholders in Kerry Co-op have signed a document which evokes rule 24 special general meetings.
Hence, the long awaited SGM in Kerry Co-op is now inevitable.
A two-thirds majority at this meeting will lock in 96.5% of the Co-op’s worth for the share redemption scheme, which will keep the conversion ratio at 5.9 PLC shares to every Co-op share.
By doing this, the shareholders are gifting €100m to milk suppliers’ possible joint venture.
In view of the fact that Kerry Co-op began in 1974 with nothing, the figure of €100m is exceedingly generous and should be much appreciated. If passed, the proposal will ring-fence 96.5% of Kerry Co-op’s worth.
Thus, in the event of a joint venture costing in excess of €100m, the shareholders will not lose out further.
It is indeed easy to spend other people’s money, but it is time the milk suppliers contributed to a joint venture if necessary.
As a milk supplier I am willing to contribute to a joint venture if a proper plan and structure are put in place to start all over again.
The 2,500 odd milk suppliers should be thankful to the 12,000 shareholders for this €100m, which works out at €40,000 per supplier.
Put another way, each of the 12,000 shareholders are contributing €8,330 each, to buy processing facilities for milk suppliers.
My Co-op shares are my retirement fund. Though I also supply milk alongside my son, I do not want my retirement fund to be cut further to finance buying processing facilities for milk suppliers.
Milk suppliers, and particularly new entrants must put their hands in their pockets and invest in their company as we did at the start of Kerry Co-op, or lose control of their own business.