pratikkk

MP Guru
Houchens Industries, is an American employee-owned company, in business since 1918 when it began as a small grocery operated by founder Ervin Houchens in rural Barren County, Kentucky. The company is headquartered in Bowling Green, Kentucky. The company runs about 425 grocery and convenience stores. Sales in 2006 were just under $2 billion.[2], with approximately 10,500 employees.

Houchens Industries, originally founded in 1917 by Ervin Houchens as a food store, today has nearly 16,000 employee owners doing business in almost every state in North America and 30 plus countries throughout the world. From humble beginnings, through today, Houchens Industries has always valued its greatest resource, its employees.

From 1988, when the company was purchased by the Employee Stock Ownership Plan (ESOP), Houchens Industries has experienced unprecedented growth.

Today, Houchens Industries, Inc. is a diversified conglomerate wholly owned by its employee owners. Houchens has businesses in retail grocery and convenience stores, quick-to-service restaurants, insurance, stock brokerage and financial services, franchising of optical stores, construction, fence materials manufacturing and distribution, crushed








stone aggregates and asphalt paving, recycling, tanning supply distribution, manufacturing, software and website development, property management and juice concentrate manufacturing and distribution.

With a strong foundation of diverse companies, coupled with each manager’s entrepreneurial spirit, Houchens Industries continues to allow their owner operators the flexibility to make decisions based on their own experiences and market places. Offering support on a diverse platform, when needed, provides the best possible environment for growth, stability and success.

Listed by Forbes as one of the largest 100% privately held companies in North America and according to the ESOP Association, the largest 100% employee owned company; Houchens Industries’ corporate headquarters is located in Bowling Green, KY.

After the dust settles, the deal calls for Hilliard employees to buy back half of their company from Houchens to form a joint venture. The deal will allow Hilliard's employees--including 411 reps--to share in company stock, something they didn't have on a broad scale under PNC.

"This is good for our reps because this gives us the opportunity for ownership, the ability to chart our own course with a supportive partner and access to capital," said James R. Allen, the chairman and chief executive officer of Hilliard Lyons.

Allen said Hilliard reps would not receive any retention bonuses in the wake of the transaction. "Usually people have to do something different to receive a retention bonus. We feel we're staying with the same company. We feel that everyone is going to do everything exactly the same." Darryl Metzger, who is Hilliard's executive vice president of branch administration, says branch managers were informed that there would be no changes to payouts, services or the computer systems for brokers.

Neither PNC officials nor Allen would disclose the price of the sale. PNC says it expects to report an after-tax gain of $50 million as a result of the transaction, which is expected to close in the first quarter of 2008. PNC has owned Hilliard (formally known as J.J.B. Hilliard, W.L. Lyons Inc.) since 1998. But the size of the firm had been fairly stagnant. In nine years, the firm grew client assets just 13% to $25.5 billion. And the number of reps shrank to 450 from 524, according to figures from the 1999 and 2007 yearbooks of the Securities Industry and Financial Markets Association (SIFMA).

When the bank first bought the Louisville, Ky.-based brokerage, the strategy was to offer a full investment menu and reach a wider client base. Now PNC wants to focus on banking. PNC will retain Hilliard for two years to support bank brokers now in the PNC Investment brokerage unit. The first iteration of Hilliard Lyons started serving clients in 1854 and has been a member of the New York Stock Exchange for 130 years. Today, it has $33 billion in client assets and 76 branch offices. Meanwhile, Houchens is trying to expand more into the financial services arena. It has revenues of $2.5 billion a year. It's entirely owned by its 11,500 employees through an employee stock ownership plan.

With headquarters in Bowling Green, Ky., Houchens operates a network of 150 independent insurance agents called Center of Insurance. Yet it's best known for the supermarket chains that it owns such as Save-A-Lot, Food Giant, Piggly Wiggly, and IGA. Houchens also runs a real estate company, an industrial recycling business and a building contractor.

Last February, Houchens sold off its cigarette-manufacturer, Commonwealth Brands, which at one time had been the fifth-largest maker of cigarettes in the country. With the $1.9 billion it received from that sale, Houchens is now trawling for investments such as Hilliard Lyons.

Allen calls Houchens management savvy investors, who are "also in the insurance business and have intentions to expand in financial services." He adds that Houchens has "no interest in running Hilliard Lyons. They want to be an investor in Hilliard Lyons."

Aaron B. Houchens is an associate at Woods Rogers PLC in the firm's litigation department.

Originally from the Roanoke Valley, Aaron graduated cum laude from Vanderbilt University in 2006 with a degree in Human Organizational Development and Political Science. In 2010, he earned his Juris Doctor from the University of Richmond, graduating magna cum laude. While at the University of Richmond, Aaron worked in the Richmond City Public Defenders office and received the pro bono service award for his work there. Aaron was a member of the Moot Court Board while in law school at Richmond.
 
Last edited:
Top