There has been a significant uptick in the amount of money Kerry Group has spent on buying its own shares over recent days, with the company spending €4.53m on Tuesday alone – a pace of purchases that is equal to €8,884 a minute during the eight and a half hours of market trading.

The purchases come as part of Kerry Group’s €300m share buyback programme which was launched at the start of May. The current programme follows another similar sized operation which ran between November 2023 and April of this year.

The €300m is scheduled to be spent between May 7 and Dec 19 this year. With 161 market trading days between those days, that equates to €1.86m of purchases per day, a pace that was fairly closely matched until this week (see Figure 1).

Interestingly, the significant increase in the pace of purchases coincided with the drop in Kerry’s share price below €75 last week, the level the shares were close to when the initial buyback programme was launched in November of last year.

Under the terms of the programme, Kerry does not buy the shares itself. Instead, Gooldman Sachs acts as its agent, buying shares in the market and then selling them on to Kerry. Kerry then extinguishes those shares.

The programme is designed as a way for the company to return money to shareholders.

The idea is that as there are fewer shares left in existence after each purchase, each remaining share is worth a slightly larger portion of the company, and therefore worth slightly more.

The share price of Kerry has been something of a mixed bag under CEO Edmond Scanlon’s tenure. When he took up the position in October 2017, it traded at €83 and then rose as high as €130 in July 2021.

Since then, things have generally gone into reverse with the share price spending most of this year under €80.

Farmer meeting

While Kerry management may be concerning themselves with investors, the first meeting of the Munster Dairy Producers Organisation (MDPO) on Thursday of this week in Limerick may also have an effect on the value of the company. Scanlon has previously said he is “open to offers” for the processor.

The MDPO may prove to be a threat to any value in Kerry Dairy Ireland. If it can sign up a significant quantity of milk, then Kerry Dairy Ireland will not be able to guarantee its milk supply beyond early 2026 - until or unless a deal is done with the MDPO.