An heiress to the Lund supermarket empire is fighting the company and her brother in court to cash out her stake — so she can use the money for philanthropic purposes, the Star Tribune reports.
In 2014, Kim Lund sued Lunds Food Holdings, Inc. and her brother, Russell "Tres" Lund III, longtime CEO of the chain now called Lunds & Byerlys, for refusing to buy out her 25 percent stake in the company. Although Hennepin County Chief Judge Ivy Bernhardson has ruled that Lunds must purchase her stake in the company, the two sides are divided over the purchase price, with Kim Lund’s financial experts valuing her portion at $80.4 million, while the company values it at just over $21 million. Bernhardson will determine the actual buyout price after the trial concludes.
For his part, Tres Lund has argued that the supermarket chain cannot sustain a large payout if it is to invest in its stores and remain independent in an increasingly competitive market. To fund a buyout at the price Kim Lund has demanded, the company further claims, it would have to borrow $76 million. While Lunds & Byerlys is solidly profitable, with annual revenue of about $660 million, management prefers not to dilute the family’s control of the company by selling Kim Lund’s stake to an outside buyer, or by raising cash through some other mechanism, the Star Tribune reports.
Lund told the court last week that once a ruling is made, she and her two children, ages 25 and 22, would decide how much money they need, while "the rest will be given back to the community." After attempting on and off for years to cash out her stake, she finally sued the company and demanded that it remove her brother as a trustee of the trusts controlling much of her stock. Court records show that she would accept a buyout over a multiyear period. A teacher for thirty years, Lund told the court that philanthropy has long been a "part-time job" for her, and that she wants to take it further. "That's what I want to do with my inheritance."