Suppliers support Superquinn deal
Food suppliers to the Superquinn group have come out strongly in support of the receivership arrangement put in place by the retailer's banks in less than 12 hours last week.
Despite the initial concern that the sale of the supermarket chain to Musgraves would bankrupt many small food producers, it now appears most of the farmer-suppliers will not be left out of pocket by the deal as it currently stands.
However, the ongoing court appeals by two directors of Superquinn to halt the receivership process and initiate an examinership process instead has left many suppliers in a state of uncertainty.
Initially, the only potential banana skin for the sale to proceed was the possibility that the Competition Authority would rule against the move.
The authority was expected to make its decision within two months, during which time supplies to Superquinn were guaranteed payment by the receivers appointed by Bank of Ireland, AIB and National Irish Bank.
Although Superquinn suppliers were left more than €25m out of pocket with this arrangement, most farmers have been promised full payment by their processors and distributors.
Exceptions to this were two large potato-growing and processing operations -- Country Crest and Peter Keogh and Sons -- in north Co Dublin. A failure to secure insurance for their sales is believed to have left these two businesses nursing combined losses of more than €500,000.
However, Country Crest's Michael Hoey was adamant that the receivership was still a better option than the examinership route being pursued by two of the three directors of Superquinn this week.
"Examinership would be very dangerous for us suppliers," he said. "You just don't know what could happen [in an examinership] so I hope it stays the way it is and cling to the hope that we might [get] some of our money back over time."
But Mr Hoey was critical of the banks involved in this deal.
"The way this deal was done was sharp practice," he said. "The banks involved are effectively burning their own customers by protecting their losses through the receivership. And meanwhile, the taxpayer is expected to continue bailing them out."
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