Baltic firm is potential bidder for Superquinn
BALTIC-BASED RETAIL and pharmacy giant, VP Group, has emerged as a potential bidder for Superquinn, whose receivership and sale are at the centre of two court actions.
Wholesale and franchise specialist, Musgrave, announced it was buying Superquinn on Tuesday morning, hours after the chain had been placed in receivership on Monday night by a Bank of Ireland-led syndicate of lenders, owed €275 million in property-related loans.
The receivership and company are at the centre of two High Court actions, one of which aims to place the business in examinership, giving it full protection from its creditors. The other challenged the validity of the receivers’s appointment.
It emerged last night that Vilnius-based VP Group is a possible bidder for Superquinn. Unconfirmed reports suggest that it may be connected with the examinership application made by a number of the chain’s directors.
VP Group owns Maxima, which is the biggest retail business in the three Baltic republics, Latvia, Lithuania and Estonia, and has businesses in other countries, including Bulgaria. It also owns a pharmacy chain, Euroapotheca. Nerijus Numavicius, one of Lithuania’s richest men, is its biggest shareholder.
VP ran the rule over Superquinn earlier this year, along with other potential bidders, and was interested in buying the business, investing in growing it further in Ireland and possibly exporting the brand.
British chain Sainsbury, which also looked at Superquinn earlier this year, is said to still be interested in making an offer.
The chain’s property liabilities put potential bidders for the business off. Those liabilities stem from the purchase of the chain by Select Retail Holdings for €450 million in January 2005.
Select’s shareholders are David Courtney, Bernard MacNamara, Simon Cantrell, Gerry O’Reilly, Bernard Doyle, Terry Sweeney and Kieran Ryan, who are associated mainly with the property sector.
The deal with Musgrave is designed to settle the banks’ property debt and would involve transferring the trading business to a new company, of which the purchaser would then take control.
The supermarket operation would then be free of the property liabilities. The trading business is said to have made a profit of about €8 million in 2009. Turnover is estimated to be in the region of €500 million.
Talks over the sale to Musgrave began last week. The three banks, Bank of Ireland, AIB and National Irish Bank, appointed Kieran Wallace and Eamonn Richardson of KPMG as receivers on Monday.
Superquinn’s overall liabilities, including the property debts, were about €425 million. The balance is due to preferential owners and suppliers, owed a total of €55 million.
Superquinn’s share of the grocery market is estimated at 6.4 per cent. At one point it held about 9 per cent of the market, but lost share to Tesco and the discounters.