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Fri Nov 30, 2012, 04:12 PM

Grocer, 70, gives stores to his employees — for free, transferring ownership as a thank you

Grocer, 70, gives stores to his employees — for free
Retiring Minnesotan is transferring ownership of his three stores as a thank you



Just in time for Christmas, a retiring Minnesota grocery store owner is giving his roughly 400 employees quite a gift — ownership of his three stores.

Instead of accepting any of the multiple offers he received from large national chains to purchase his stores, Joe Lueken, 70, will transfer ownership of his two Lueken’s Village Foods in Bemidji, Minn., and another one in Wahpeton, N.D., to his employees as part of an employee stock ownership plan (ESOP). The transfer of ownership from the Lueken family to the employees will begin on Jan. 1, and will not cost the employees any money.

The amount of shares each employee receives will be based on length of service and salary. The program is expected to pay the Lueken family off for the sale in three to five years, according to a report by the Minneapolis Star Tribune.

“My employees are largely responsible for any success I've had, and they deserve to get some of the benefits of that," Lueken told the Star Tribune. "You can't always take. You also have to give back."

After being informed by his two sons that they were not interested in taking over the business, Lueken and his family came up with the employee stock ownership plan to transfer ownership.

http://today.msnbc.msn.com/id/49984095/ns/today-good_news/#.ULkgwmfT1iM

44 replies, 4051 views

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Reply Grocer, 70, gives stores to his employees — for free, transferring ownership as a thank you (Original post)
Liberal_in_LA Nov 2012 OP
yellerpup Nov 2012 #1
Booster Nov 2012 #22
yellerpup Nov 2012 #29
awoke_in_2003 Dec 2012 #38
OneGrassRoot Nov 2012 #2
LadyHawkAZ Nov 2012 #3
ChisolmTrailDem Nov 2012 #4
Barack_America Nov 2012 #5
HiPointDem Nov 2012 #6
jtuck004 Nov 2012 #10
Lucky Luciano Nov 2012 #19
jtuck004 Nov 2012 #24
Lucky Luciano Nov 2012 #27
jtuck004 Nov 2012 #32
HiPointDem Nov 2012 #21
freshwest Nov 2012 #7
itsrobert Nov 2012 #15
japple Nov 2012 #20
freshwest Dec 2012 #42
awoke_in_2003 Dec 2012 #39
adieu Nov 2012 #8
Caeser67 Nov 2012 #9
femrap Nov 2012 #11
sabrina 1 Nov 2012 #12
blackspade Nov 2012 #13
midnight Nov 2012 #14
MotherPetrie Nov 2012 #16
rivegauche Nov 2012 #17
dionysus Nov 2012 #18
Iggy Nov 2012 #23
Shankapotomus Nov 2012 #28
Iggy Nov 2012 #30
flying-skeleton Nov 2012 #25
Democratopia Nov 2012 #26
ElboRuum Nov 2012 #31
glinda Dec 2012 #33
saidsimplesimon Dec 2012 #34
zaj Dec 2012 #35
Lucky Luciano Dec 2012 #41
calimary Dec 2012 #36
Odin2005 Dec 2012 #37
high density Dec 2012 #40
limpyhobbler Dec 2012 #43
AverageJoe90 Dec 2012 #44

Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:37 PM

1. I love this guy.

This makes perfect sense.

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Response to yellerpup (Reply #1)

Fri Nov 30, 2012, 06:45 PM

22. Gotta love his sons also. Chips off the old block. Good family.

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Response to Booster (Reply #22)

Fri Nov 30, 2012, 07:44 PM

29. No doubt about it.

I'm sure everyone loves them.

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Response to Booster (Reply #22)

Sat Dec 1, 2012, 04:23 PM

38. I was skeptical about the sons...

from what was posted, I figured they expected their father to sell and they would eventually get the money. But the story has a quote from one of the sons that proves that this family is a class act.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:39 PM

2. Bravo! K&R n/t

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:43 PM

3. Wow

Every time I manage to finally, completely lose faith in humanity, some wonderful person has to come along, do something fantastically kind and generous, and screw it all up. Dangit, people! Stop being so gosh darned nice! Have a little respect for us cynical curmudgeons!

This made my day. What a great thing to do.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:44 PM

4. Now THAT is a true American hero and business man!

This is a true "job creator", not the greedy bastards running our economy into the ground for more, more, more money. He is more than a job creator. He is an opportunity creator. He has given a great gift, the chance for his employees to have a better life.

If only I could take this man by his shoulders and look him in the eye and hug him for what he is doing.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:46 PM

5. "You can't always take. You also have to give back."

Is there such a thing as Quote of the Year?

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 04:47 PM

6. I wonder if the employees will sell it for a quick payout. I wonder if the buyers who were

 

interested will send moles with bribes.

Interesting.

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Response to HiPointDem (Reply #6)

Fri Nov 30, 2012, 05:27 PM

10. First they have to tpay off the debt they took on, the proceeds of which go to


the guy who "gave" them the business.

Estimated payout to him and his family is 3 to 5 years.

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Response to jtuck004 (Reply #10)

Fri Nov 30, 2012, 06:16 PM

19. I caught that too, but it does not negate the gift.

The employees just own a leveraged business. There is still value in the equity granted.

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Response to Lucky Luciano (Reply #19)

Fri Nov 30, 2012, 06:53 PM

24. That is an assumption. There is no value until the loans are paid off.


And their pensions or 401K's are very likely to be collateral, and very, very likely to be underfunded, and thus another liability.

How about an analogy?

"Hey mom, I am giving you my house that I can't sell. I took out a new mortgage and took all the cash, but I am GIVING you the home, and the mortgage for you to pay. You should be able to sell it for a profit in a few years. Because they never go down, the Bernanke said so. Regardless, I got money, and it's gonna be a GREAT Christmas".

From a financial perspective he gave an asset, attached to several liabilities, got paid, and it may or may not work out for them. He and his family walk away with a few million, but it will be years before most of the employees know whether they get anything but a paycheck from this, except for, perhaps, a few that retire earlier.

And despite what was said, there is nothing out there that indicates there was ever any offer for the business from anyone else, which is very likely in such a competitive and likely to fail arena. So he and the family took the out that would give them some serious cash, and left whatever happens in the future with others.

You can drive down the street in just the town I am in and I can show you four major groceries sitting empty, all different names, all with more resources than this gentleman had, all failed. And they are all over the country, just takes a little web searching.

Again, not dissing the deal, but people are leaving out a bunch of really important reality to fluff up a story. And that's bullshit.

But nothing new. People see saints in the impressions in their taco sauce, so it doesn't surprise me that people make up their own reality about this deal either. Hey, 47% voted for RobMe - if that doesn't support a theory of mass delusion, I don't know what does.


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Response to jtuck004 (Reply #24)

Fri Nov 30, 2012, 07:28 PM

27. There is still value to the equity.

If a company issues a big bond and increase their leverage ratio by a few factors, the equity is not worthless. There is definitely value, but it is clearly riskier equity than what the retiring owner held before retiring.

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Response to Lucky Luciano (Reply #27)

Fri Nov 30, 2012, 10:04 PM

32. Of course, never stated otherwise. What I always question is the size of the equity.


I hope it works out for them, but all the hoopla about how it was "given" was a bit much, I think.THe ex-owner has significant cash in his pocket, they get ?, and we won't know until they get the cash.

Bob's Red Mill did an ESOP a couple years ago iirc, and last I looked theirs was doing well, no debt. Perhaps this one will work out too. Not all do, but in this case the guy that is "giving" the store away, and the family who he feels deserves a share too, without more work, is most likely getting millions if there is much value there.

So the family's Christmas is certain to be merry. We won't know about the others until they cash out, which is no sure thing in today's market. They could be gone in the flash of a Walmart. And it probably won't be millions for each worker either.

This is aong the lines of things I am interested in, so I may keep a lookout.

I wish them well, but that's what I call re-gifting.

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Response to jtuck004 (Reply #10)

Fri Nov 30, 2012, 06:27 PM

21. edit: never mind, i see the debt is for the esop shares.

 

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:04 PM

7. Good man. If only Sam Walton had done so instead of passing his business onto his greedy offspring.

Last edited Sat Dec 1, 2012, 06:32 PM - Edit history (1)

I saw the reverse of what this gentlemen did play out in several companies and the devastation it wrought to manufacturing. It is the Reagan, Gordon Gecko mentality.

In each case, the children were in love with wealth and did the same thing Romney did, bankrupting the place to live high on the proceeds and shipped the equipment and jobs overseas with no regard to the community or workers.

I believe that with the re-election of Obama that Americans have shown that they reject this model. Kudos to the man who did the right thing here.

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Response to freshwest (Reply #7)

Fri Nov 30, 2012, 05:49 PM

15. What does John Walton leaving his sawmill to his children

have to do with this?

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Response to itsrobert (Reply #15)

Fri Nov 30, 2012, 06:19 PM

20. Well John Boy and Jim Bob seemed to have quite a bit of business experience.



Psst...I think he/she meant Sam Walton.

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Response to japple (Reply #20)

Sat Dec 1, 2012, 06:31 PM

42. Yeah, I did. But I won't be around much for a while. So have at.

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Response to itsrobert (Reply #15)

Sat Dec 1, 2012, 04:25 PM

39. you can't trust those mountain folk...

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:20 PM

8. He should be able to shop free

there for the rest of his life.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:22 PM

9. A True "Job Creator."

And an even better person.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:29 PM

11. Damn shame this

 

is the extraordinary and not the ordinary.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:31 PM

12. He even looks like such a nice guy!

I love when people like him do something like this as it highlights even more how someone can be a success without stepping all over the workers.

He deserves to have a wonderful rest of his life!

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:35 PM

13. Awesome! A true American.

The fundies will go crazy over this.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:36 PM

14. What a great way to do business....

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:52 PM

16. K&R for this great guy

 

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:55 PM

17. What a great guy!! LOVE this story.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 05:57 PM

18. bravo

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 06:47 PM

23. But, But... this is Marxism!!! no, no NO!!!

 

"workers shall own the means of production and distribution of what they produce".

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Response to Iggy (Reply #23)

Fri Nov 30, 2012, 07:29 PM

28. Maybe the owner could sense the jig was up?

He's retiring anyway so what will it matter to him now? Looks like the capitalist knew something about Worker's Self Directed Enterprises all along but didn't let his workers in on it until the end.

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Response to Shankapotomus (Reply #28)

Fri Nov 30, 2012, 08:45 PM

30. Heh Heh.... Right

 

that or Marxism isn't so bad after all.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 06:53 PM

25. Mitt Romney needs to meet THIS guy for Lunch

Maybe he'll learn something !!

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 07:19 PM

26. Another story that makes me cry.

 

So much greed and meanness in the world, but here is a really good guy doing something amazing for others.

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Response to Liberal_in_LA (Original post)

Fri Nov 30, 2012, 08:51 PM

31. THIS GUY IS FUCKING WIN BEYOND WORDS!

And yes, I AM SHOUTING! But it's the happy kind.

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 11:29 AM

33. We knew him and also his sons. A wonderful family.

The sons (one looks like the late John Jr.... seriously) were working with the stores as he was starting to phase out his role but they do indeed have other lives and locations. Does not surprise me at all that they did this. He also was very kind when I asked for funds for the New No-Kill shelter. I love him. I love his family. *heart*.

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 02:22 PM

34. Mr. Lueken and family, thank you for your generosity. I'm so

proud of the families who demonstrate why immigration has made the US a country like no other.

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 03:06 PM

35. Correct me if I"m wrong, but he's selling his stores to his employees

... not giving them anything.

Right?

I guess, giving them the right not to be employed by Safeway?

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Response to zaj (Reply #35)

Sat Dec 1, 2012, 05:03 PM

41. It is a sale to the employees paid for by profits that the store makes.

Nothing out of pocket from the employees

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 03:07 PM

36. This says it all: "You can't always take. You also have to give back."

Wouldn't it be great if all business owners had that attitude. This gentleman is correct. Most of his success is directly traceable to the hard work of his employees. God bless him for recognizing that!

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 03:26 PM

37. Minnesota Nice!

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Response to Liberal_in_LA (Original post)

Sat Dec 1, 2012, 04:31 PM

40. "For free?" Free to the employees, but it sounds like he's still making out.

It sounds like he is having the business buy shares in the company from him which the business then gives to the employees. Not a terrible idea by any means, but the headline insinuates he's giving the business away, which he isn't.

http://www.startribune.com/local/180550281.html?refer=y

The program will pay off the Lueken family in three to five years and leave employees with shares based on length of service and salary, at no cost to them. If the company keeps growing, the shares' value will too, and the group is obligated to repurchase shares of any employee who leaves or retires.

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Response to Liberal_in_LA (Original post)

Mon Dec 3, 2012, 07:16 PM

43. oh wow that's cool/ k/r nt

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Response to Liberal_in_LA (Original post)

Mon Dec 3, 2012, 07:48 PM

44. Kudos to Joe Lueken!

This is exactly the kind of thing I like to see from business people.

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