The LacPatrick letter of intrigue

On the week longstanding chair Hugo Maguire once again announced his intention to retire, I see it is all not plain sailing for LacPatrick Co-op.

The Dealer understands that LacPatrick, the progeny of the mixed marriage between the Town of Monaghan and Ballyrashane co-ops, is once again being met by some anger from a small section of suppliers.

Not for the first time since the merger, an unsigned and anonymous letter is circulating among suppliers. While The Dealer has seen a copy of the letter, it would be unfair and legally questionable to divulge the details in full.

The letter outlines information on senior staff salaries and the wages bill, before and after the appointment of the relatively new chief executive, Gabriel D’Arcy.

The letter goes on to outline the alleged salaries of senior management personnel including the new position of chief operations officer. The letter also alleges some 25 new staff have been appointed and, collectively, they cost a pretty penny.

Retirements

One insider confirmed to me that new staff have been appointed but some of the more senior ones have been brought in because of a number of impending retirements. So rather than having to learn the ropes after the people retire, there will be a transitional period before that.

So, who is sending these letters and why?

Well, there is a fairly large group of disgruntled LacPatrick suppliers in Northern Ireland. These are mostly people who left Dale Farm to join Ballyrashane (out of loyalty to their local co-op) but who have found themselves in LacPatrick since the merger.

There are also a few dissenting voices from suppliers south of the border.

D’Arcy’s style is not everyone’s cup of milk. He’s a shrewd and, at times, ruthless operator and, from his time in Bord na Móna, he was known to cut cloths to measure.

There is also the minor issue of the shrinking of the LacPatrick board from 25 to 16. The two original boards sat in what must have been one large board room following the merger, and it was always the plan to do an operational transformation.

Finally, there’s the whole capacity and milk pool conundrum. LacPatrick has put a significant part of its powder-shaped egg in the African market-shaped basket with its famous LP brand. With a shiny new 7.5t/hr dryer at Artigarvan, Tyrone, coming on stream in 2017, the co-op has significant new capacity so needs to retain its existing milk pool, and expand it. It also needs favourable trade deals post-Brexit, although it isn’t the only Irish dairy co-op with its fingers crossed.