Mundy Hayes became chair of Kerry Co-op exactly four years ago. He faces the first challenge to his tenure next week. Irrespective of the result of that vote, he has made an indelible imprint on the co-op.

When he stepped into the hotseat, Kerry Co-op was in flux. Relations with the plc were at a low ebb, with Stan McCarthy having quit the role of co-op chief a few months earlier. The co-op had always relied on the plc for all support functions, but now needed to consider how it would operate from here on. The split was precipitated in part by a row over bonus payments, with a test case involving the outgoing chair James Doyle heading to arbitration. Doyle had been unseated as chair when he lost his seat on the board, an indication of the split within the co-op over the drift from Kerry Group and its management. On top of all this, Revenue had just issued tax demands relating to a patronage share scheme.

A mess

Rather than plot through the events since, suffice to say that the co-op has repaired relations with the plc to the point where the two are negotiating the possibility of transforming the Irish dairy business to a joint venture, with the co-op as majority shareholder. The arbitration and Revenue cases are settled, both in the co-op’s favour, although Revenue is appealing the patronage share tax decision.

Meanwhile, Kerry Co-op shareholders have availed of a series of “cash for shares” schemes, with well over €200m paid out to shareholders.

Divisions

The divisions in the co-op still exist. The main opposition to Mundy’s tenure has centred in the Shareholders Alliance. It wants a full dissolution of the co-op, with control of processing vested in a new co-op forged from the ashes of the old one, but comprised only of Kerry’s 3,200 suppliers, as opposed to the 12,000 current shareholders.

They are critical of almost every strategic decision the board, advised by Thomas Hunter McGowan, the co-op’s CEO, has taken. Following some recent board changes, they now feel they have enough strength to mount a challenge for the chair’s position, with Pat Rohan standing against Mundy.

Kerry Co-op, for so long the top dog of the Irish dairy sector, has long been isolated. The board’s understanding of the parallel journey Glanbia has taken is not what you might expect it to be. Especially when you consider it is are the only other plc dairy processor in the country, and have evolved to a joint venture, 60/40 arrangement.

While they rarely look out, the rest of us are all looking in, fascinated.