Wholesaler Musgrave Group has today unveiled a new €10 million (£8.8 million) fund to help suppliers who have lost out as a result of Irish supermarket Superquinn entering receivership last week.
The syndicate of banks which represents Superquinn, made up of Bank of Ireland, NIB and AIB, are also supporting the fund, which will be administered by the Joint Receivers of the supermarket.
Musgrave is currently seeking approval from the Competition Authority in Ireland for the acquisition of the grocer, and the move is part of the group’s commitment to continuing relationships with those firms which supplied Superquinn prior to its collapse and follows calls to action from business and government.
Pressure group Food and Drink Industry Ireland (FDII) welcomed today’s initiative after ten days of uncertainty for many operating in the food sector.
FDII Director Paul Kelly said: “There now appears to be broader understanding of the issues facing the industry and we welcome this very positive initiative from Musgrave and the joint receiver, which will help maintain the viability of many food companies.”
Musgrave anticipates that the creation of the fund will result in all trade creditors, whose losses are not covered by credit insurance, recovering between 65-70 per cent of their losses incurred from Superquinn’s demise.
Suppliers will only be able to access the finances if Musgrave’s purchase of Superquinn is approved, and the terms of the fund stipulate that payments will commence as soon as the purchase process is completed.
Chris Martin, CEO of Musgrave, believes the takeover will secure the jobs of 2,800 employees and he has already detailed a number of its plans for developing the supermarket brand in the years ahead.
“On completion of the sale Musgrave intends to invest in the stores and work with all Superquinn employees to develop the future of the business,” he added today.
“Musgrave is committed to providing existing Superquinn suppliers with the opportunity to continue to supply Superquinn stores.”
The impact of Superquinn’s receivership was also felt in Northern Ireland (NI), with a number of suppliers north of the border losing out financially.
NI Enterprise Minister Arlene Foster is urging Musgrave to increase its communication with Invest Northern Ireland in order to ensure companies outside of southern Ireland can take advantage of Musgrave’s far-reaching supply chain.
“I understand that as a result of the acquisition a number of Northern Ireland companies are now unlikely to receive full payment for goods provided over the past 90 days,” she said.
“To help minimise any such losses, I will urge Musgrave to maintain relationships with Northern Ireland suppliers and further explore the wide range of high quality, award winning produce available here.”