FOOD GIANT EMPLOYEES BUY ALL 81 STORES FROM OWNER

SIKESTON -- Food Giant employees now own 100 percent of the company.

As of March 1, all of Food Giant's 81 stores were sold to an employee stock ownership plan or ESOP by Ken Storey, the company's founder. The ESOP provides the opportunity for all employees to share in the ownership of the company.

An ESOP is a special type of defined contribution plan designed to provide employees with an ownership interest in their company. Plan assets are invested primarily in the stock of the sponsoring company. Participants' accounts are credited with shares of stock that represent their beneficial ownership in the company.

By selling the company to an ESOP, Storey was able to fund his retirement as well as reward long- term employees who have worked to make individual stores and the overall company successful.

The stores are spread across Missouri, Kentucky, Tennessee, Mississippi, Arkansas, Alabama, Florida and Georgia. In Sikeston, it includes Market Place, Stan's Food Mart and Piggy Wiggly as well as the corporate offices at 120 Industrial Drive.

There also is a Food Giant store in Cape Girardeau.

"By spreading the ownership of the company among employees, we have a real opportunity to build employee commitment to the company's future success by serving our customers and contributing to the local communities in which the individual stores are located," said Ron Watkins, the newly named chief executive officer for Food Giant Supermarkets Inc.

Details of employee participation in the ESOP will be mapped out for the workers in a series of meetings to be held in each region in early April. Information will be shared about the purchase, and there will be a slide presentation and discussion of the impact of the sale on the workers. Watkins will discuss what the changes mean for all employees.

"We will see renewed enthusiasm among our employee owners," said Watkins. "When there is a problem we will fix it. We will all be proud that we can fix the situation."

In turn, he encouraged customers to talk with the employee owners to offer suggestions and voice any concerns.

"In addition to the opportunity for employees to share in the benefits of ownership, we believe people in the communities in which our stores are located will benefit by shopping in stores where their neighbors are owners," said Tom Schmutz, vice president of the northern region.

The company will be run by a board of directors consisting of Watkins; Kevin Ladd, who is taking over as chief financial officer; three vice presidents, Gary Duncan, Jim Bishop and Schmutz; and two outside directors, Richard Adams and Bill Tomlinson.

The change in ownership signals some other changes in the company as well. As an ESOP company, there will be much more communication with employees and sharing of information about the company's progress.

"We are in the process of designing some exciting new plans for encouraging employees to voice their ideas for improving the company at the store, regional and corporate level," said Watkins. "At the same time we will be strengthening our emphasis on employee education and training so that we can all do the best job possible for our customers."

Although the purchase was kept low key, Watkins said the announcement has brought real excitement into the company. "I can see change in some people already. They realize this is a great opportunity for them."

Financing for the transaction was made possible by a loan from Firstar Bank of Bowling Green, Ky.