Co-op Tirlán is proposing to spin-out around 15 million shares in Glanbia plc worth €239m to its members.
The move, which is backed by the board, would see each member get Glanbia shares in proportion to the number of shares they have in the co-op, or approximately €7,013 in value for every 1,000 co-op shares held.
However, the plan will require member approval at a special general meeting, because under a current rule the co-op cannot reduce its shareholding in Glanbia below 17% from the current 28.9%.
"At a forthcoming SGM, we will be seeking Member approval to amend this co-op Rule," said John Murphy, chairperson of Tirlán Co-operative Society Ltd.
"As a Board, we firmly believe that now is the right time to provide our co-op with greater flexibility to better manage our financial investments."
Tirlán has carried out similar share spin-outs over recent years as it seeks to diversify its investments.
Since 2013, Tirlán or Glanbia Co-op as it was previously known, has spun out 48.6 million Glanbia shares with a current value of €772 million to its members.
It is understood the co-op does not have any plans to ultimately divest itself completely of its Glanbia stake.
"Our objective, over time, is to diversify and to target increased farmer returns over the long-term to meet the needs of our members," said Mr Murphy.
"Our focus is on maximising farm returns through payments for milk and grain, as well as targeting the payment of a strong co-op dividend, allowing us to reward Members now and into the future."
"We have built a strong co-op and now is the time to help future-proof it for this generation and generations to come."
On average, the co-op estimates that its 11,046 members, mostly farmers, would benefit to the tune of €24,604.
Tirlán is currently worth around €1.7bn, but a significant amount of that value is concentrated in its Glanbia shareholding.
It is expected that if the rule change is approved the spin-out of shares would take place in the second quarter of the year.
"In the coming weeks we will be engaging with our representative structure on this important proposal and would encourage as many as possible of our Members to attend our series of information sessions," said Seán Molloy, Chief Executive Officer of Tirlán Co-op.
"Our Co-op Board and management team look forward to answering our Members' questions and hearing their feedback on this proposal."
"Our farmer-facing team and Co-op Office staff are also available to provide information to Members. We will write to all eligible Members in the coming days with details on how to register and vote at the forthcoming SGM."
In 2022 Glanbia Co-op completed the acquisition of Glanbia plc’s 40% interest in Glanbia Ireland for €307m giving it full ownership of it.
Later the same year Glanbia Ireland and Glanbia Co-op rebranded as Tirlán.
