News
15.02.2010
French co-op in £102m deal to buy Greencore
One of France's biggest grain co-operatives has struck a £101.85million deal to buy Europe's third biggest maltster.
Greencore Malt, which has operations at Buckie and at Glenesk at Hillside, near Montrose, looks likely to be sold to Axéréal, which was formed last year by the merger of Agralys and Epis Centre.
The French business trades more than 8milion tonnes of grain a year and has an annual turnover of £2.44billion.
It already owns Boortmalt, a maltster that produces 620,000 tonnes a year from sites in Belgium, France, Hungary and Croatia. Greencore Malt, which operates seven maltings in the UK, Ireland and Belgium, has an output of 500,000 tonnes of malt a year.
The deal will create the world's fifth biggest maltster. But it is conditional on shareholders in Ireland's Greencore Group approving the sale at an extraordinary meeting, due to be held in early March.
The deal is the latest in the malting market. United Malt Holdings, which includes Bairds Malt, Scotgrain Agriculture and Saxon Agriculture in Scotland, was bought for £423million by Sydney's GrainCorp in October
Greencore's Scottish operations, where 27 staff are employed, concentrate on providing malt to distillers. It has recently invested millions of pounds in expanding operations at Buckie by adding 10 new steep tanks to allow it to increase annual output from 40,000 tonnes to 60,000 tonnes.
Greencore chief executive Patrick Coveney said with the business increasing its focus on its sandwich and ready-meal operations in the UK and US it was time to sell the malt division.
Reacting to the news Allan Bowie, vice-president of NFU Scotland, said: "In past years, Greencore's contracts have been very beneficial for malting barley growers and I hope that these growers will at least be given the chance to help meet the plants' expectations of the tonnage required. These same growers will be looking for a signal from the new owners in the next six weeks.
"With market conditions being what they are, I hope the new owners will take a long-term view to allow malting barley growers to meet their expectations."
News of the deal came as malting barley growers were told that demand is likely to remain low again this year.
Eddie Douglas, operations manager at Arbroath's Baird Malt, told an Edinburgh seminar held by arable levy board HGCA that demand was likely to return in the medium term as sales of Scotch were expected to be in excess of 350million litres by 2015 - 10million more than the peak seen in 2007.
The thorny question over how much area is put down to spring barley was answered by Mr Douglas, who said the 709,177 acres planted in 2009 was the highest for 20 years. Going forward he was of the opinion that 617,750-642,460 acres would yield 900,000 tonnes of malt by 2015.
Aberdeen Press and Journal
