The transaction, which is expected to be completed by March, will see Dairy Crest's shareholding in the Irish cheese, cream and milk supplier drop from 80% to 30%. The shares will be bought by Wexford Milk Producers, which will become the majority shareholder with a 70% stake, and the cash will be put towards Dairy Crest's long-term strategy of repaying bank debt. The company will continue to provide packing and distribution services to Wexford, as well as selling its branded cheese in the UK.
"The strategy of Dairy Crest's Foods Division is to increasingly focus on a small number of key brands," said Martyn Wilks, executive MD of Dairy Crest's Foods Division.
Wexford Creamery has a turnover of 56m, and Wexford Milk Producers is a co-op of 350 dairy farms.