CASH and carry group Musgrave has started a major assault on the Northern Ireland retail market and is aiming to have up to 50 Supervalu supermarkets in operation there by the end of the decade.
Musgrave yesterday bought four shopping centres and a supermarket in the Belfast area from J & J Haslett for an undisclosed sum. This is the Cork group's first foray into the retail market although it has operated a cash and carry operation in Belfast since 1984 and in Derry for the past two years.
Musgrave chief executive Mr Hugh Mackeown said the Northern market could accommodate between 40 and 50 Supervalu supermarkets and up to 100 Centra convenience stores. "It's realistic to expect to have two more stores signed up by the end of 1996, have 12 to 15 a year later and then add six or seven a year after that," he told The Irish Times.
A chain of 50 Supervalu stores would increase Musgrave's turnover by around £100 million, equivalent to about 7 per cent of Northern Ireland's current retail market.
Musgrave has acquired four shopping centres and a supermarket in Downpatrick, Carrickfergus, Banbridge, Dundonald and Belfast. It is planning to sell the 30 smaller retail units in the shopping centres possibly to the sitting tenants.
The five supermarkets, which have a combined sales area of 40,000 sq ft, will become part of the Supervalu chain. They will be sold to independent retailers who would continue to trade under the Supervalu banner.
Mr Mackeown said that further expansion of the Supervalu chain could come mainly through bringing existing Northern retailers into the Supervalu network. "There are retailers there who are interested in what we have done in the Republic," he said.
In the Republic, Musgrave has 160 independently owned Supervalu outlets and 223 Centra and Centra Quickstop convenience stores.
Unlike the Republic, where "symbol" chains like Supervalu "have" 26 per cent of the market, "symbols" have only 11 per cent of the market in the North.
"We would hope that the expansion of Supervalu into this market would begin to restore a better balance between the multiple and independent sectors in Northern Ireland, as it has in the Republic," Musgrave director and Supervalu chief executive Mr Seamus Scally said. He added that the Haslett acquisition would establish Supervalu in the Northern Ireland market before the British multiples got a dominant foothold.
Haslett is using the proceeds of the sale to develop a large chain of Mace convenience stores in the North and the first of these opened in Belfast in early December.
Haslett managing director Mr Harry Morrison said his company plans to spend £3 million over the next two years to develop the Mace chain.
The retail market in the North is currently dominated by multiples, with ABF's Stewarts and Crazy Prices chains having a combined 39 per cent market share. Fitzwilton's Wellworth subsidiary has around 21 per cent, while Dunnes Stores has around 7 per cent.
The market, however, is in a state of flux with the major British multiples targeting the North for expansion either through acquisition or green field development.
Sainsbury has already begun an eight store super store development in the North, although the British chain is encountering planning problems.
Tesco offered to acquire Stewarts/Crazy Prices from ABF, but this deal fell through when ABF and Tesco failed to agree on price.
Musgrave has expanded rapidly in recent years, both through acquisition and expansion of the Supervalu chain.
