Food group Glanbia yesterday sold part of its UK operations in a deal understood to be worth around €11 million.
The company announced that it had sold its fresh pork business, Glanbia Fresh Meats (UK), to Flagship Foods, one of Britain's leading players in that sector.
Glanbia did not reveal the sale price, but The Irish Times understands from market sources that it was in the region of €11 million. The net assets sold were €22.3 million.
In a statement, Glanbia said it expected the deal to result in an exceptional charge of €21 million against its earnings in the current year.
Yesterday, group managing director Mr John Moloney said he did not expect the write-off to have a big impact on earnings. "It's only about 5 per cent of turnover, we would expect it to be modestly dilutive in the short term," he said.
He also said the group planned to close its remaining pig slaughtering facility in Gainsborough, Lincolnshire, with the loss of 85 jobs.
That operation was not part of yesterday's deal. Mr Moloney said it was unlikely that any costs associated with this would have a material impact on earnings.
Mr Moloney said the company was getting out of the pork business in the UK as it wanted to focus on its consumer foods business.
"We've been signalling this for some time," he said. "We looked at sustainability going forward, and we realised we'd have to grow the business, or get out of it, it was a case of grow or go, we decided to go."
Mr Moloney added that the business in Britain was going through a period of consolidation. Grampian Meats and Flagship are emerging as the leading players in the sector. The UK market was also highly competitive, as Dutch and Danish producers export to there, Mr Moloney explained.
"We now intend to continue the process of developing our strong international positions in cheese, nutritional ingredients and consumer foods," he said.
Glanbia bought the business in 1992, when it was known as Barrett and Baird of West Bromwich. It invested £4.5 million sterling (€65.35 million) in its facilities in West Bromwich and Tipton.
In 1999 it took over Nimmo Meats with facilities in Scotland and Gainsborough. Glanbia subsequently centralised operations to Gainsborough.
It sold Nimmo's other facility in Drongan, Scotland.
