New $170m USA Cheese and Whey Products Facility Planned by Glanbia in Joint Venture with DFA and Select

Glanbia plc announces that it is in advanced negotiations with Dairy Farmers of America, Inc. (“DFA”) and Select Milk Producers Inc. (“Select”) to build a $170m cheese and whey products production facility in the Western Texas / New Mexico region of the USA. This new plant will be 50% owned by Glanbia with the balance jointly owned by DFA and Select. The proposed project will be funded by way of $35 million of equity investment each by Glanbia and DFA/Select (total $70m) with the remainder directly financed by the Joint Venture entity.

If the project proceeds as planned, commissioning of the new facility is expected in the second half of 2005. Once fully operational, it is anticipated that the new facility will generate sales in the region of $340 million per annum and will employ approximately 200 staff. Glanbia will have full responsibility for operations and for sales and marketing of the product stream through its existing structures.

Once fully commissioned, the new facility will annually process over 2.3 billion pounds of milk and produce 250 million pounds of cheese and 16.5 million pounds of high value added whey proteins. It is expected that the plant will also, over time, become the largest advanced whey processing facility in the Northern Hemisphere.

Commenting on the announcement, John Moloney, Group Managing Director, Glanbia plc, said, “This project will be a significant step forward in the implementation of Glanbia’s growth strategy. It will position us as the number one producer of American type cheddar cheese in the USA and simultaneously build our global position as a supplier of advanced technology whey proteins to the nutritional sector. We are delighted to partner with DFA and Select on this project. These co-operatives have access to a growing, large scale milk pool in the West Texas / New Mexico region.”

Gary Hanman, CEO of DFA added, “In conjunction with Select and other dairy farmers in the Greater Southwest Agency, we have a rapidly growing milk supply in that region of the country. We are pleased to have joined forces with an operating partner of Glanbia’s calibre. We have a long standing relationship with Glanbia, which has built a reputation in the USA for developing and operating large scale, efficient facilities. We look forward to working closely with them to maximize market opportunities for the benefit of all our stakeholders.”

Mike McCloskey, CEO of Select added, “As a co-op comprising large scale dairy producers in the Southwest region of the USA, we are looking forward to extending our relationship with DFA and joining with Glanbia in developing what will be one of the most modern and efficient facilities of its kind in the world. This is a major project which will greatly benefit all milk producers in the region.”

9 July 2003

Additional Information:
Glanbia plc is an international cheese, nutritional ingredients and consumer foods company with operations in the USA, Ireland and the UK. It is the largest dairy processor in Idaho, USA and is a global player in advanced technology dairy-based nutritional ingredients. Headquartered in Kilkenny, Ireland, the Group had sales in 2002 of €2.3 billion.

Dairy Farmers of America, Inc., headquartered in Kansas City, Missouri, is the largest dairy co-operative in the United States and the largest marketer of fluid milk in the world. During 2002, DFA marketed 47.8 billion pounds of milk, constituting 28.2% of total US milk production. In addition the company operates 27 manufacturing plants that produce a wide range of dairy products. 2002 sales amounted to $6.4 billion.

Select Milk Producers Inc. was formed in 1994 by a group of large dairy producers in New Mexico. The majority of members are located in the New Mexico / West Texas region, which is the fastest growing milk producing region in the USA. The group supplies a range of America’s leading food manufacturers with quality fluid milk, both natural and concentrated, for further processing. In 2002 Select sold 3 billion pounds of milk with a value of $400 million.

Issued by Glanbia plc, Dairy Farmers of America, Inc., and Select Milk Producers Inc.

Enquiries to:

Glanbia : Jeff Williams, Executive Vice President, Glanbia Foods Inc.
Tel: (208) 733-7555

DFA: Agnes Schafer-Kreiser, Vice President, Communications
Tel: (816) 801-6478

Select: Michael J. McCloskey, CEO, Select Milk Producers
Tel: 219 613-9877

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