The path has been cleared for Musgrave Group’s takeover of Superquinn following the establishment of a €10 million fund to reimburse the Irish retail chain’s uninsured suppliers.
Five Superquinn directors, who had petitioned the Irish High Court to halt the takeover and appoint an examiner instead of receivers, said they were withdrawing their challenge as a result of the Musgrave decision. Their main concern, they said, had been to secure a better outcome for suppliers.
Some 50 potato growers, who are owed more than €500,000, will be among the beneficiaries of the fund. Together with others in the fresh produce sector, they had been refused payment by the receivers, who had been appointed by a Bank of Ireland-led syndicate.
The banks are owed €275m by Superquinn and the receivers insisted that they had first claim on the €200m takeover price being paid by Musgrave.
The supplier fund was welcomed by the Irish Farmers’ Association, which had warned that failure to pay growers could shut some of them down.
Its president, John Bryan, said that with 70 per cent of the Irish market now controlled by three multiples - Musgrave, Tesco and Dunnes - legislation establishing a statutory code of practice was needed urgently to protect primary producers.
The Irish Competition Authority will now have the final say on the Musgrave takeover. If approved, the deal will put the Cork-based group in a position to challenge Tesco as Irish market leader.
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