A market force from humble beginnings

October 04, 1994|By David Conn | David Conn,Sun Staff Writer

A photograph in the Business section yesterday incorrectly identified the two founders of Giant Food Inc. Nehemiah M. Cohen was pictured on the right, and Samuel Lehrman was on the left.

The Sun regrets the errors.

The corporate union that gave birth to the largest supermarket chain in the region officially was torn asunder yesterday.

The four grandchildren of Samuel Lehrman, who helped finance the first Giant Food store in Depression-era Washington, announced plans to sell their half of the voting stock in Giant Food Inc. to Britain's largest food retailer, J. Sainsbury PLC.

The sale will end a 58-year-old relationship between the family of Nehemiah M. Cohen, a native of Palestine who immigrated to the United States in 1915, and the family of Mr. Lehrman, a Harrisburg, Pa., food wholesaler.

FOR THE RECORD - CORRECTION

Mr. Lehrman's son, Jacob, joined Mr. Cohen in running the operation, which, as one of the first grocery chains in the nation, quickly spread throughout the Washington area.

Today, Giant's 160 stores represent the largest concentration of supermarkets in the Baltimore-Washington corridor. The company's reach extends from Charlottesville, Va., to its newest location in Bear, Del.

In recent years, the company's earnings growth has been slowed by competition from large warehouse-style retailers and by saturation of its own stores in the Baltimore-Washington market.

If the financial challenges that Giant faces played a part in the decision of Jacob Lehrman's four children to sell their shares, the family wasn't saying so yesterday. In a statement, they said only that they wished to "to diversify the family's assets."

In 1935, Nehemiah Cohen, a rabbi and kosher butcher who owned several shops in Lancaster, Pa., approached Samuel Lehrman with the idea of copying the supermarket concept that was popular on the East Coast.

Mr. Lehrman agreed to finance the venture, and his son, Jacob, joined Mr. Cohen in opening the first store in February 1936, during one of Washington's worst blizzards. They chose the city because of a belief that it would soon grow to accommodate a mushrooming federal government.

The two were helped by Mr. Cohen's sons, Israel and Emmanuel, who stuck with the company. The younger Mr. Lehrman eventually rose to executive vice president.

By the early 1960s, with Nehemiah Cohen's succession still unclear, a dispute grew between the Cohen and Lehrman families. Each held 125,000 shares, or 50 percent, of the voting stock of Giant Food. A single voting share was held by the company's outside counsel, Joseph B. Danzansky, and he cast it in the Cohens' favor.

Mr. Lehrman remained on the board of the company until his death in 1974, when his wife, Charlotte, assumed his seat. But the incident effectively ended the Lehrman family's active involvement in Giant Food. When Mr. Danzansky stepped down in 1978, Israel Cohen took over the reins and still holds them today.

Of the four Lehrman children, only one is on the board: Samuel M. Lehrman, a 44-year-old real estate manager and investor, who became a director after his mother's death in 1985. The other Lehrman-appointed board seats are held by:

* Max N. Berry, a Washington attorney and political fund-raiser who is married to Samuel's sister, Heidi L. Berry. Mrs. Berry, 50, is a freelance journalist and Washington editor for the monthly magazine Art & Auction.

* Scott B. Laurans, 47, a partner in the Providence Group Investment Advisory Co., in Providence, R.I.

The other Lehrman heirs are Fredrica Lehrman, 53, an attorney in Washington, and Robert Lehrman, 43, an investor and administrator of the Jacob and Charlotte Lehrman Foundation.

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