Glanbia will hold a 40 percent stake in the joint venture, to be renamed Dairy Ireland, and the co-op will own 60 percent.

The co-op's stake in Glanbia will fall to 31.5 percent from 36.5 percent as a result of the transaction, which Glanbia hopes will close by mid-year.

Glanbia on Wednesday reported an 11-percent increase in earnings per share, topping a forecast range of 8-10 percent.

It said it expected earnings per share to climb 7-10 percent in the coming year.

(Reporting by Conor Humphries; editing by Jason Neely)