LOS ANGELES -- A shareholder proposed buying Smart & Final from the U.S. subsidiary of its France-based parent company, during Smart & Final's annual meeting here last week.
The shareholder, Robert Donahue, of La Jolla, Calif., said he is prepared to put a $20 million deposit into an escrow account with the intention, within 45 days, of buying Casino's shares at $10 a share -- well above the 8-5/16 closing price of Smart & Final stock the day of the meeting.
Company officials told SN that Donahue has been in touch with Smart & Final in the past about his proposal. They also told SN he was out of order in making an offer without legal documents and that Casino USA, not Smart & Final, is the party to which he needs to make the offer. Casino USA is a wholly owned holding company for Casino France.
However, Ross Roeder, chairman, president and chief executive officer, suggested to Donahue he submit his proposal in writing to be forwarded to the appropriate parties.
Donahue told SN he personally owns nearly10,000 shares of Smart & Final stock and, in conjunction with his brother-in-law, a personal finance broker, represents approximately 96,000 shares
During the meeting, the company reviewed its 1999 performance and discussed results for the first quarter ended March 26, during which sales rose 0.3% to $399 million and comparable-store sales increased 2.2%, with the company achieving positive earnings of $636,000, compared with a loss a year ago.
Sales in the company's warehouse-store segment rose 3.1% during the quarter and comps were up 2.2%, while sales in its food-service distribution segment fell 7.7%, due in part to the continuing focus on credit worthiness and profitability rather than sales growth, Roeder said.
He said the company plans to open eight to 10 new stores this year, with 15 to 20 scheduled for 2001. He also said Smart & Final plans to launch its previously disclosed e-commerce test in June.