Kerry Group

Background

Formation

Its name comes from the rural county Kerry in Ireland, in 1972 a small independent cooperative societies and milk suppliers merged and became Kerry Co-op. 13 men in their late 20’s worked together in a parking lot of a milk processing plant, for about 18 months. Farmers of Kerry got together and bought 83% stake of an aforementioned milk processing plant outside of Listowel. The membership to the group was open to all milk suppliers, and on return the got shares of the company, all equally distributed, for a democratic control of the Co-op (one member one vote). Nine thousand dairy farmers responded to this. In 1973 Ireland joined the European Economic Community (EEC) and this accelerated the merger of many small dairies in Ireland so as to be able to compete with the larger milk companies. By 1974 there job was to consolidate and rationalize the various operations involved with the collection, processing and distribution of milk, butter and other dairy products of casein (a protein powder extracted from milk).

In the period 1974 - 1979 Kerry expanded its milk business in a similar fashion to other dairy Co-ops. EEC entry had brought better milk prices, increased milk volumes and improved farm incomes in Ireland. Kerry Co-op grew organically simply by taking the milk that came its way, processing it and meeting all other farmer requirements in terms of inputs and on-farm services. Its milk supply increased from 67 million gallons in 1974 to 87 million gallons in 1978.

The 80’s (Down and Up again)

By the year 1979 Kerry lost almost 20% of its milk supply because the county was chosen as a pilot area for a bovine disease eradication scheme. This is when they realized that they could not rely only on dairy products and diversify into more ‘value added’ activities.

In 1980 a five year corporate plan was defined and agreed by the Board, as research and development became a priority, ass well as the diversification into the convenience meat products business with the acquisition of the Denny pork and savory products business in Ireland and made its first incursion into beef processing, again, on the home market. In 1983 it was decided to establish U.S. and UK headquarters - opening offices in the Hancock Centre in Chicago and in London. The Erie Casein company's interest in NKMP was acquired