Glanbia shares surge as activist investor piles pressure on food group to split

Irish Independent

01-05-2025

Frankfurt-based Clearway tells shareholders at AGM that 'sprawling structure' is cause of share volatility
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A better-than-expected performance by food group Glanbia pushed its shares 10pc higher for a time on Wednesday, as an activist investor told its AGM that concerns about poor returns for shareholders are 'broadly shared' with the group's investor base.
Shares jumped after Glanbia reported better than anticipated Q1 performance and retained its full-year earnings guidance. It reached a high of €11.80 before slipping back in later trading.
Clearway Capital, an activist investor based in Frankfurt, is pushing for Glanbia to be split up and is trying to drum up support for the move. At Wednesday's meeting, it urged the Glanbia board to initiate a strategic review into potential disassembly.
In response, Glanbia CEO Hugh McGuire told analysts there are 'no sacred cows' and that the company would listen to all shareholder proposals.
Last week Clearway Capital issued a plea to Tirlán Co-op, urging it to support a plan to split up Glanbia.
Tirlán is Glanbia's most influential shareholder by far. The co-op has a 28pc stake, but members control an additional 20pc-30pc of the stock.
Addressing the AGM, Clearway founding partner Gianluca Ferrari said that the reasons for Glanbia's relatively weak share price, hovering around €11, had to be scrutinised. This was the price it had been at in 2013, and there was no gain since – despite a strong bull market.
'Over the past decade the shares have swung wildly,' he said. 'They've approached €20, only to fall back to €10 again. More than once.
"Yet the underlying businesses, when taken separately, have always been worth more than what the share price at any given time would imply.'
He said that analyst reports place a value of €21 on Glanbia shares and questioned why they have 'continuously and perpetually' traded at less than that.
Mr Ferrari claimed that Glanbia is a 'sprawling and complex conglomerate' comprising three very different businesses.
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'While successful in their own right, under the same corporate structure the moving parts make it complicated to understand, difficult for the market to value, and even harder to manage,' he said.
'The structure is the root cause of volatility,' Mr Ferrari insisted. 'The case for vertical integration has clearly not held true – it didn't help predict or manage whey price cycles. There is an obvious solution: separate the businesses.'
Mr Ferrari said he has held meetings over the past two months with many of Glanbia's largest institutional shareholders.
Mr McGuire told the AGM that the group delivered a 'resilient performance' during the first quarter of 2025, with a 4.5pc rise in like-for-like revenue while it navigated macroeconomic volatility and short-term headwinds in its performance-nutrition division.
'We have made good progress on our group-wide transformation programme, which is focused on delivering efficiencies, optimising our portfolio and maximising long-term value for shareholders,' he added.
Revenue in its performance nutrition division declined by 6.6pc, with Optimum Nutrition revenues down by just over 3pc.
The company said that excluding SlimFast and Body & Fit, which have been designated as non-core and following a decision to exit the businesses, revenue in the sector was down by 4.8pc.