Convenience retailing legend Colin Graves has sensationally quit the company he founded 26 years ago following a falling out with its owners Bibby Line Group, The Grocer can reveal.

Costcutter was due to announce Graves’ departure as The Grocer went to press, but it is understood he quit in January after being offered only a non-executive role within the company.

Graves sold a 51% stake in Costcutter to Bibby in 2007 and in November last year Bibby acquired the remaining 49%. At the time, Graves was named CEO of Bibby Retail Services and chairman of Costcutter.

The Grocer understands Bibby wanted Graves to be a figurehead only, and although Graves continuing to work with the senior management team, negotiations over his role could not be resolved.

“Colin Graves was offered the position of non-executive chairman following the restructuring of the board of directors. However Colin did not wish to accept this offer as he wanted to pursue new opportunities in addition to his current external activities,” Costcutter confirmed in a statement.

One senior industry source said Graves’ departure would be a “significant blow” for Costcutter, “Many retailers have enormous respect and loyalty to him,” the source said. “To them he is Costcutter. It’s a bad move by Bibby to let him go.”

Read our 150th Anniversary interview with Colin, in which he reflects on a quarter of a century in grocery.