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local
news
Another store bites the dust
By
David Lindsay
Following the publication of a story on Malta’s potentially
endangered supermarket sector, and in particular the recent ailments
experienced by the sector’s giant – Price Club - in last
week’s MaltaToday, the newspaper was inundated with phone calls
requesting further information.
In the latest wave of misfortune to hit the supermarket sector,
a supermarket known as "Savemart", with no managerial
connection to Savemart Co. Ltd, in San Gwann, which is managed by
MA Supermarkets, was closed down last week.
According to sources, the store had been badly mismanaged by the
tenants and had gone bankrupt – consequently closing its doors
for business. The move had taken employees completely unawares,
who had reportedly been taking turns at cashing their paycheques
from the store’s tills in order to avoid the banks.
The closure follows hot on the heels of the highly publicised shutting
down of Supermaster in Mriehel, which had prompted employees to
stage a sit-in protest for their paycheques.
However, despite the fact that recent reports that the Price Club
supermarket chain, Malta’s largest, is in serious financial
difficulty, sources high up in the chain’s management yesterday
refuted speculation that it might shut down certain outlets.
Sources explain, "An approximate Lm4 million debt looks awesome
to some, but it isn’t when one views the capacity of the business."
They added that more than 80 per cent of Malta’s business community
face similar problems.
Sources add that the chain, with an annual turnover in the vicinity
of Lm24 million, is here to stay and that the recent closure of
Supermaster had added fuel to the fire of speculation surrounding
the chain of late.
Speculation had surfaced late last week when news emerged that an
urgent creditors’ meeting had taken place and that the chain
was to offer creditors equity shares in a potential Malta Stock
Exchange equity listing in return for debt cancellation.
The Price Club chain is in the process of carrying out a restructuring
programme with the assistance of PricewaterhouseCoopers, which will
help the company to analyse its actual position and take action
from there.
With some 600 people directly employed with the Price Club Chain
and several hundred more indirectly, if the company were to go under,
the implications would be felt all around.
However, when questioned on the matter, Price Club director Victor
Zammit rebutted such claims by explaining, "The Price Club
is not in difficulty. It is true that a creditors’ meeting
was held Friday night and everything is now back to normal.
"They [the creditors] wanted to ensure that monies owed are
secure."
However, Mr Zammit refused to comment on whether creditors had been
offered equity shares in an eventual Price Club stock market listing.
Meanwhile, reports that the company is failing to pay its creditors
in order to free funds for the opening of new outlets were denied,
with Mr Zammit explaining that the Naxxar and Attard Price Clubs
purchases had been agreed upon over a year ago.
The chain was recently extended through the opening of two more
stores – one in Attard and another in Naxxar following the
purchasing of the localities from Happy Savers Supermarkets in deals
that involved considerable sums of money.
Meanwhile, seven sites in Tripoli have been allocated to the chain,
which is expected to open eight new stores in Libya, seven in the
capital city and another in Benghazi.
The Price Club Supermarket chain is also expected to further expand
its business in Malta with a Lm3.5 million investment earmarked
for Save-On supermarket in Marsa.
Work on the project was scheduled to begin by the end of last year
but Planning Authority permits are reportedly yet to materialise.
The new store is set to be the company’s largest retail outlet
yet, on a bigger scale than the Swatar premises which is believed
to be the biggest and busiest supermarket on the Islands. |
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