I see that four years have passed since Kerry Group sold the liquid milk business it had in Co Limerick and Co Clare to Glanbia, in early 2011. Liquid milk producers in the area are now hoping that Glanbia will continue to take their milk and sell it locally under the Golden Vale and Dawn brands.
In the €10m deal, Kerry Group agreed to supply milk to Glanbia and it leased the Kilkenny-based group the right to sell milk products under the popular brands in Limerick and Clare.
Kerry sourced the milk from its then liquid suppliers. Their manufacturing milk was processed by Kerry, but their liquid output went for bottling at Ballytore or for manufacturing at Ballyragget – depending on Glanbia’s day-to-day requirements.
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Suppliers were paid for all of their milk by Kerry, with Glanbia reimbursing Kerry for the liquid supply. That deal was to run to 2015.
With the agreement of all parties it could roll over for another two years, during which time another multi-year contract could be agreed. The roll-over period is now under way.
The deal has allowed Kerry to concentrate on its core businesses and it increased throughput at the Glanbia plants.
If Glanbia wants to keep using the brands it will do a deal with Kerry Group. Suppliers now hope that the power of the Golden Vale and Dawn names remains strong enough to persuade both companies to continue the arrangement.
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I see that four years have passed since Kerry Group sold the liquid milk business it had in Co Limerick and Co Clare to Glanbia, in early 2011. Liquid milk producers in the area are now hoping that Glanbia will continue to take their milk and sell it locally under the Golden Vale and Dawn brands.
In the €10m deal, Kerry Group agreed to supply milk to Glanbia and it leased the Kilkenny-based group the right to sell milk products under the popular brands in Limerick and Clare.
Kerry sourced the milk from its then liquid suppliers. Their manufacturing milk was processed by Kerry, but their liquid output went for bottling at Ballytore or for manufacturing at Ballyragget – depending on Glanbia’s day-to-day requirements.
Suppliers were paid for all of their milk by Kerry, with Glanbia reimbursing Kerry for the liquid supply. That deal was to run to 2015.
With the agreement of all parties it could roll over for another two years, during which time another multi-year contract could be agreed. The roll-over period is now under way.
The deal has allowed Kerry to concentrate on its core businesses and it increased throughput at the Glanbia plants.
If Glanbia wants to keep using the brands it will do a deal with Kerry Group. Suppliers now hope that the power of the Golden Vale and Dawn names remains strong enough to persuade both companies to continue the arrangement.
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