Further controversial happenings during Jerry Henchy’s tenure as Dairygold chief executive were aired in the High Court this week.

Jerry Henchy denied that he interfered in an election for co-op chairman that was held in at infamous board meeting at Christmas 2006.

Under cross examination, Henchy said he had a one-to-one conversation in his office with vice-chairman Patsy Kelleher minutes before this meeting started but that it was normal to do so to prepare for meetings.

He had no recollection of instructing his secretary to call in Patsy Kelleher to his office as the vice-chairman was making his way to the board room.

He then discussed the election because he was “curious” about what the outcome would be. He would have known that any interference by a chief executive in a board election would be improper, he said.

He said he was aware that outgoing chairman John Walsh was likely to be challenged for the chair that day by another board member, Vincent Buckley, whose style, he agreed, was to question management’s actions.

He had had ‘robust exchanges’ with Vincent Buckley over a long-term bonus plan for management.

However, he denied that he told Patsy Kelleher that if Buckley was elected he, Henchy, “would be out of there that evening”.

“That is wrong,” Henchy told the court. “I said [to Patsy Kelleher] it would be difficult for me to work with Mr Buckley.”

He denied that he attempted to influence how the vice-chairman would vote.

Repeatedly asked by Dairygold senior counsel Paul Gardiner why he made his comments to Patsy Kelleher, he told the court: “I felt it was important that he’d understand my views” on who would be future chairman.

“I didn’t see my discussion with Mr Kelleher having any effect on the outcome,” he said. He did not recall asking Mr Kelleher how he planned to vote but Mr Kelleher may have told him, he said.

The court heard how Patsy Kelleher went into the meeting and told the assembled board that he had important information and was requesting that the election be postponed. But following an adjournment, it went ahead and John Walsh was re-elected by a close margin.

Three board members walked out of the meeting and there were allegations in the media of management interference in the election.

During this detailed cross questioning, Jerry Henchy was told by Judge Herbert that in his replies he, Henchy, was not making sense, that he was ‘hairsplitting’ and talking in riddles.

This board meeting and election took place on 20 December 2006.

At the request of Vincent Buckley, another meeting took place two weeks later, on 4 January, to discuss why the chief executive could not work with Vincent Buckley.

The minutes recorded that Jerry Henchy did not give his reasons and Vincent Buckley told the chief executive, forcefully, that he was a bluffer.

Dairygold brands

Jerry Henchy was cross examined on events leading up to the sale of the Breeo food business, along with its iconic brands such as Dairygold, Galtee, Shaws and Mitchelstown, to Kerry Group.

He said that by 2007, four years after his arrival, profits in the food business had been lifted to €14m. However, the view of management was that, to maintain profits in the face of retail power and own brands, the business had to grow by acquisition or amalgamation or had to be sold.

An informal approach was made to buy the division and this led to formal evaluation of a number of bids, these from Kerry Group, Ion Equity and, Henchy said, a few other ‘tyrekickers’.

At that stage, the Reox board discussed whether it should formally enter sale negotiations and voted on the matter.

Four members voted against a sale. Three of them, Flor Riordan, Bertie O’Leary and Vincent Buckley, were at the time also on the Dairygold board. The fourth, John Fitzgerald, was an outside director.

Five voted in favour of sale. These were Jerry Henchy, outside directors Liam McGreal, Michael Jacob and Peter O’Donoghue, and John Walsh, who was chairman of Dairygold and Reox.

Reconsidered evidence

Jerry Henchy withdrew direct evidence he had earlier given regarding the manner of his dismissal. He had in fact been allowed to continue using his office for a number of days after being removed and he apologised to the court for claiming otherwise.