Musgrave to ditch Superquinn brand and merge its 24 shops with SuperValu

The Mandate trade union said yesterday it was "hopeful" that some of the 102 staff at Superquinn facing redundancy could be redeployed into other roles within the Musgrave group, which owns the supermarket chain.

Mandate assistant general secretary Gerry Light said the union would "work hard" with the company over the next 30 days to seek redeployment for the support staff at Superquinn's administrative base in Lucan who are facing redundancy after the Cork-based company announced its intention to merge the business with its SuperValu chain of stores.

Musgrave said it currently has 44 vacancies within the group and it would engage with staff and their unions to see if any of these could be filled by those employees affected by the job cuts.

This follows the decision of Cork-based Musgrave to ditch the Superquinn brand and merge its 24 shops with SuperValu’s chain of 198 stores.

The move will give SuperValu a 25 per cent share of the Irish grocery market. It will overtake Dunnes Stores as the number two player behind UK retailer Tesco when the merger is completed next February.

Musgrave chief executive Chris Martin told The Irish Times yesterday that some of the redundancies could be compulsory. He said it was a tough decision to axe the Superquinn brand.

"If we'd been able to retain Superquinn that would have been great but given that we've now come to this decision it provides a real opportunity for SuperValu. It makes it number two in the [Dublin marketplace after Tesco] and it gives us scale."

Steady decline

In its heyday, Superquinn had a market share of just under 9 per cent but it has been in steady decline for the past decade. Its sales once topped €600 million but have declined steadily to €450 million, due to a flight to value by shoppers and the entry of German discounters Aldi and Lidl to this market.

Musgrave has invested €15 million in Superquinn to date with another €10 million earmarked to improve its stores and product offering.

Mr Martin said he had no regrets about acquiring Superquinn or the €229 million price it paid for the business. “The stores gave us a real foothold into Dublin. That was an important consideration for us as we were underrepresented in Dublin.”

Superquinn was founded in 1960 by Senator Feargal Quinn, who sold the business in 2005 to Select Retail Holdings, a consortium of property investors led by Irish retailer Simon Burke, for about €420 million.

Customer reaction

Commenting on the possibility of Superquinn’s customers reacting negatively to Musgrave’s decision to ditch the brand, Mr Martin said: “There’s no doubt that people will be saddened to see the Superquinn name change but customers have told us that as long as you don’t change the range and as long as you keep the expertise and the relationships that they have in store . . . and you bring in the other added elements like the [SuperValu] own brands then they want to stay with us as a store.”