Irish food group Glanbia is to sell its Irish dairy ingredients, consumer products and agribusiness units to Glanbia Co-operative Society, its 54.6% shareholder, for EUR343m (US$463.4m).

The firm announced it was in talks to sell the unit last month.

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The sale would leave Glanbia to focus on its US and international cheese and nutritionals businesses, the company said today (20 April).

The terms will see the co-op get control of three principal business units: Dairy Ingredients Ireland, Consumer Products and Agribusiness, as well as Glanbia Estates, Group Business Services and Irish Joint Ventures and Associates.

This includes brands such as Avonmore, Premier and Kilmeaden.

Glanbia said that the price will be paid by placing 102m of its shares held by the co-op, adjusted by a risk-sharing adjustment, plus cash of EUR49.7m. The sale is conditional on the disposal proceeds being at least EUR299.6m.

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Following the placing, the co-op will still have around a 20% shareholding in Glanbia but will reduce this to around 10% in September when it plans to transfer 50% of its remaining shareholding directly to members.

The transaction is conditional upon the approval of the members of the society. Glanbia says it expects the sale to go through by mid June.

The board said it believes that the disposal will “strengthen” Glanbia’s balance sheet and provide financial flexibility to allow the group to develop its international business operations further and fulfil its growth potential in the nutritional ingredients and cheese markets.

John Moloney, group managing director of Glanbia, said: “In a changed global dairy market environment, the time and opportunity is now at hand to recognise and embrace the need for transformation. This transaction provides the prospect of reshaping the business and unlocking growth and development potential for both the society and the company.”

Check back later for further insight into Glanbia’s dairy unit sale.