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Matt O'Kee e examines the shareholders
value at both Glanbia and Kerry
Exactly 12 months ago, our Very End column in IFM
outlined the extraordinary wealth that had been built up
by shareholders in the Kerry and Glanbia Cooperatives by
virtue of their shareholdings in their related Plc's. At that
time Kerry Coop shares had an underlying value of 550
each while a Glanbia Coop share was worth an estimated
56 if converted into Plc shares. In terms of market
capitalisation, Glanbia Plc was not as valuable as Kerry plc
but nevertheless Glanbia Coop owned over 30 per cent of
the Plc worth an estimated 1.4 billion, while Kerry Coop
still held a 13.7 per cent stake in the Plc, worth over 2
Glanbia share rollercoaster ride
A lot has happened in the intervening twelve months. While
both coops retain the same Plc shareholding as they did in
December 2018 the disparity in the valuations has widened
considerably. At Glanbia Plc's current share price the
underlying value of a Glanbia Coop share is just under 30.
That's a reduction of more than 26 on the value one year
ago. Contrast that with the current value of a Kerry Coop
share. In November 2018 the underlying value based on the
Kerry Plc share price at the time was 550. In November
2019 that value had increased to 680, a rise of 130 in
the twelve months. It is not only the changed valuations
in the twelve months that makes interesting reading. The
price volatility of Glanbia Plc shares in the interim is also
notable. At one stage earlier this year Glanbia Plc shares
were trading over 19, driven up by short selling speculators
gambling that Glanbia Plc. end of 2018 fi nancial returns
would depress the share price allowing them to make a
killing. In the event, Glanbia's profi ts and revenues for 2018
were impressive and the short sellers were stung, forcing
them to buy replacement shares at a higher cost than
anticipated, driving up the share price. That price spike
was short lived, with a mid-year trading outlook and profi t
warning from the company indicating di culties around
All change at