Household brand will continue

MUSGRAVE will run the Superquinn chain of stores as a multiple, resulting in it going head-to-head with its main chain of owner operated SuperValu stores.

Cork-based Musgrave said it will not be franchising the Superquinn stores in the same way it does its SuperValu and Centra brands.

This news comes as it is confirmed Musgrave has taken over Superquinn in a multi-million euro deal.

As part of the €100 million deal Musgrave will take on the assets of Superquinn, which will see it owning 10 to 11 properties. They will also acquire the brand, the distribution centre and the head office. The receiver however will be responsible for the debts. It is understood that Superquinn has debts of more than €400m.

Musgrave has no plans to re-brand SuperValu stores as Superquinn outlets and also have no plans to expand the Superquinn operation into Cork and Kerry.

Musgrave chief executive, Chris Martin, said the last few days have been “hectic” but they were conscious to get the deal through quickly so as not to unsettle staff.

He said that this deal will give them increased access to the Dublin market adding that they have a “big challenge” ahead.

Musgrave has its strongest presence in Munster, while 16 of Superquinn’s 24 stores are in Dublin. It will now increase its market share in Dublin from 10% to 22% following the deal.

He said that they have been aware of the situation with Superquinn for the past two to three months but felt the liabilities associated with the company were too much to take on. As soon as a receiver was appointed he said they were able to “move at speed” given they had reviewed the business.

The family-owned Musgrave group operates a range of retail outlets including SuperValu, Centra and Daybreak in Ireland, Budgens and Londis in Britain and Dialprix in Spain.

It is believed it could take between three to 10 weeks for the deal to be signed off by the Competition Authority.

A Musgrave statement said: “This purchase secures the jobs of 2,800 people and, on completion of the sale process, Musgrave intends to invest in the stores and work with the Superquinn employees to develop the future of the business.”

In 2008, there was also talk that Musgrave would purchase Superquinn chain of supermarkets. According to reports then, Musgrave was thought to have offered €150m to Goldman Sachs in London, which was handling the process but Superquinn’s owners were thought to be seeking about €250m.