Glanbia has signed a legally binding agreement to sell its 40% stake in the country's largest dairy processor, Glanbia Ireland, to the Glanbia Co-operative Society.
Plans for the €307m deal were announced last month when it emerged that a non-binding memorandum of understanding between the parties had been agreed.
This morning Glanbia plc said its board believes the now binding agreement will continue the alignment of its portfolio through the strategic focus on global nutrition and through strategic joint ventures.
"As a brand owner and provider of value-added nutrition solutions serving high growth markets, the PLC will increasingly focus on its global nutrition strategy," it said.
"The proposed transaction will also allow the PLC to deploy the capital received from the proposed transaction in investment to drive further growth and to return capital to shareholders," the company added.
With 11 processing plants, 52 retail branches and over 2,000 employees, Glanbia Ireland is a joint venture which is currently 60% owned by Glanbia Co-Op and 40% by the PLC.
The proceeds of the all-cash deal will be primarily invested in growth opportunities, the company said, with up to 50% being returned to shareholders via a share buyback.
Glanbia said completion would not take place until the first half of next year.
An EGM will be required to seek the approval of shareholders, while special general meeting of the co-ops members will also take place on December 17.
After completion both the co-op and Glanbia Ireland will change their names to not include "Glanbia".
Share in Glanbia were higher in afternoon Dublin trade.
