The Musgrave Group has sold its UK business, which operates the Budgens and Londis brands, to UK wholesale provider Booker for €57m.
Musgrave, whose retail partnership brands include Supervalu and Centra, has sold the business on a cash free-debt free basis, it said.
CEO of the Musgrave Group, Chris Martin, said that the UK grocery market is experiencing fundamental and permanent structural change with intense competition and deflationary environment.
“Given these challenging market dynamics, we carefully evaluated all of the possible options for our UK business,” he said.
“The agreement also includes the development of a strategic partnership with Booker,” Martin said.
Martin said that Booker will be a good fit for retailers and will continue to develop the Budgens and Londis brands utilising the supporting supply chain and head office.
Retailers will benefit from Booker’s buying strength an extensive operational footprint throughout the UK including a nationwide distribution and cash and carry infrastructure and a service culture that is proven to meet the needs of independent retailers, he said.
Musgrave UK has been a loss-making business, according to the CEO of the company.
“While the decision to sell Budgens and Londis is difficult, it will allow the Group to drive forward with its growth strategy which is about developing our market-leading retail, convenience and cash and carry brands in the Republic of Ireland, Northern Ireland and Spain,” he said.
“We see the opportunity for growth in the improving Irish economy,” Martin said.
Completion of the transaction is subject to CMA approval, the Musgrave Group said.