The door has been opened for Irish retailer Musgrave to go ahead with its acquisition of bust counterpart Superquinn after court action was abandoned.

Directors of Superquinn, which collapsed last week, today withdrew proceedings in the Irish High Court to put the retailer in examinership - a course of action that jeopardised a Musgrave takeover.

Follwing the decision Musgrave said in a statement: “Musgrave believes that its agreement on terms to purchase Superquinn, which is subject to regulatory approval, is the best available option for the business. 

“The transaction will secure the long term viability of the business, protect jobs and ensure that Irish consumers can continue to enjoy the Superquinn product offer.”

Withdrawal of the examinership proceedings followed the establishment by Musgrave of a €10m fund to help cover losses suffered by Superquinn suppliers as a result of its collapse last week with debts of €400m.

Legal advisers to Superquinn and two of its directors who had sought examinership said they were happy to withdraw their action in the light of Musgrave’s “very significant offer” to suppliers Irish broadcaster RTE reported.