Dairygolds Demise - inevitable evolution, bad management or worse?
Does anyone think it odd that Kerry Co-op have snapped up all of Dairygold's consumer brands on the cheap (€140 million, some €25 million less than book-value last year), while Dairygold was being managed by Jerry Henchy, a former senior Kerry Co-op Executive?

Henchy, colloquially known as 'Hatchet Henchy' for his penchant for trimming costs, was head-hunted from Kerry Co-op by Dairygold's Board of Directors, as their new CEO, some 6 years ago. He was fired last week under mysterious circumstances from his CEO post in Dairygold, having already been let go from REOX, a mutant Dairygold subsidiary in January 2009. Henchy is now rumoured to be in receipt of a €3 million golden-boot payment from Dairygold, having led that Co-op to near bankruptcy during the Celtic Tiger boom. If that exit payment is even half that much, then at the very least Dairygold owe a full explanation of his sacking and remuneration to their 10,000 shareholders.

In the 6 years since he was appointed boss of Dairygold. Henchy has presided over the effective emasculation of Dairygold, the pride of the Golden Vale co-operatives. He has eliminated most of their production capacity, laid off 2/3rds of their employees and run up extra-ordinary debt under the subsidiary company, REOX Holdings, where net debt rose from €21 million to €148 million in the year to September 2008. Dairygold's own debt has risen by 95% to €70 million in the same period. Henchy's final act as CEO was selling off Dairygold's valuable consumer brands to their arch-competitor and his former employer, Kerry Co-op, at a discount after the competition authority held up the deal for 12 months. Dairygold last week announced a cut in milk prices paid to their farmer/suppliers just when rumours are rife that Dairygold is insolvent and may be taken over by the banks.

The whole ethos of the Irish Farmers Co-operative Society movement is demeaned by this debacle, which seems to have had the active approval of Dairygold's Board of Directors, most of whom have been in office since before Henchy's appointment as CEO. Call a spade a spade here.

Perhaps he is just the 'patsy' for a failed power trip by Dairygold's Board of Directors? Most other large Co-ops have 'gone public' and the resultant rise in share values has helped farmers survive.

Dairygold's shareholders look like they will be left with nothing but debt! Some questions need to be asked, and answered;

Why was Henchy sacked and why was he paid a lump sum from Dairygold and/or REOX?
Have Deloitte and Touche, Dairygold's auditors, any comment on this? (They were after all the shareholder's watchdog agency during Henchy's 6-year tenure as CEO of Dairygold and REOX). Do the Banks now effectively own Dairygold?
What is their position as regards the Board of Directors of Dairygold?
Does the Minister for Agriculture, Brendan Smith, endorse what has happened to one of the 5 biggest players in Ireland's agri-sector?
Is the Junior Minister for Agriculture, Ned O'Keeffe, himself a substantial Dairygold shareholder and supplier, satisfied with Dairygold's current state of affairs?
Is the Competition Authority really satisfied that Kerry Co-op's owning so much of the nations food brands is a good thing?
Are Dairygold's 10,000 farmers-shareholders satisfied that their interests as Shareholders and as Co-op members, have been well served by Dairygold's Management and Board of Directors?

http://www.farmersjournal.ie/myJournal/forum/content/dairygolds-demise-inevitable-evolution-bad-management-or-worse