Less than a month after the rumour originally surfaced that Musgrave were to buy Superquinn, a report in this Morning’s Irish Examiner suggests that Musgrave is now the front runner to take over the primarily Dublin based chain.
It is also suggested that they will buy the retail business only with a price tag of €150 million and that the properties will remain in the ownership of Select Retail Holdings (SRH).
While SRH’s Simon burke denies that the business is for sale, it has been confirmed that Goldman Sachs have been appointed to mange any bids.
The article in today’s Irish examiner says that SRH is owned by property developer Jerry O’Reilly, estate agents David Courtney and Bernard Doyle, as well as hotelier Terry Sweeney and that Mr Burke is adamant that they do not want to sell. However, given the current credit crunch, a €150million cash injection would be welcome by any consortium that includes property developers whatever their publicly stated position.
If this cash is required quickly it may influence who the buyer is and a sale to Cork based Musgrave may be favoured ahead of the red tape that would be involved in selling to international giants such as Asda-Walmart or Sainsbury.
Musgrave lacks a strong penetration in the greater Dublin area especially under the Supevalu brand and a takeover of Superquinn would propel it to the status of ‘major player’ in Dublin.
The high quality offering of Superquinn stores would be much more suited to Supervalu’s “Real Food, Real People” positioning than Asda’s positioning, however Musgrave would continue to compete well directly with Dunnes and Tesco on price.
Musgrave management have refused to comment.