Activist Clearway Pushes SlimFast Owner Glanbia on Spinoffs

04 May 2022, 04:36 AM IST

(Bloomberg) --

Activist investor Clearway Capital is pressing Ireland’s Glanbia Plc to spin off some of its branded businesses, as part of a plan to extract value and double the food and nutritional products company’s market value to over 6 billion euros ($6.3 billion).

Clearway, which earlier this year bought a stake in Kilkenny-based Glanbia, is pushing the company’s board to “immediately” start working on spinning off consumer brands including SlimFast and Optimum Nutrition into a standalone entity with dual listings in the U.S. and Ireland, the firm wrote in a letter to Glanbia’s chairman seen by Bloomberg. Clearway also called for Glanbia to begin streamlining its European cheese joint ventures.

Glanbia shares traded down 1.4% as of 1:26 p.m. in Dublin after climbing as much as 3.1% following Bloomberg’s report on Clearway’s spinoff plans for the company.

“The outcome of our proposed actions would immediately unlock over 10.88 euros in additional value per share and put the company in position to deliver long-term value for its shareholders,” Frankfurt-based Clearway said in the letter.

Glanbia has “a clear strategy addressing consumer health and wellness trends,” a spokesperson said. Activities in nutrition and its supply chain “are leveraged across our two complementary platforms spanning nutritional ingredient solutions and global leading brands,” and “the business performed strongly in 2021 and plans further growth in 2022.” The company “continues to engage openly and transparently with all our shareholders.”

The Clearway plan would allow each business “to focus on addressing the challenges they are currently facing which include improving execution in Glanbia Performance Nutrition, freeing up capital to invest in and grow Nutritional Solutions and work to address overarching sustainability concerns related to dairy production,” according to the letter.

Clearway, founded in 2021 by Gianluca Ferrari, earlier this year pressured French energy major TotalEnergies SE to stop buying oil from Russia following the invasion of Ukraine. Ferrari has also run activist campaigns affecting companies such as EDP Renovaveis SA, Greencore Group PLC and John Menzies PLC.