Dive Brief:
- Ingles Markets is vigorously pushing back on an effort by an investment firm linked to the opioid epidemic to elect one of its representatives to the grocer’s board of directors, which the company said would harm its operations and damage its stock price if approved by shareholders.
- The investment firm, Summer Road LLC, sent a letter to owners of Ingles’ stock urging them to vote for Rory Held during Ingles’ upcoming annual meeting, which is set for April 30.
- In a letter to shareholders, Ingles’ board said that associating with Held, who it said is an employee of Summer Road, would “be harmful to Ingles and all of our stakeholders.”
Dive Insight:
Summer Road said Held would provide an independent voice on Ingles’ board, adding that the board and the company’s management “have failed [shareholders] by treating the Company like a private entity run for the benefit of Chairman Robert P. Ingle, II.”
Summer Road, which says it owns about 3% of the outstanding shares of Ingles’ Class A common stock, said in the letter that Ingles’ shareholder returns have underperformed that of other publicly traded grocers and companies in the S&P 500 in recent years.
“[I]ngles leadership has presided over prolonged periods of underperformance, maintained a culture of opacity and prioritized their own capital returns while keeping our dividends stagnant for decades,” Summer Road wrote.
Ingles said shareholders should not vote for Held because Summer Road is the family investment office for members of the Sackler family, which controlled pharmaceutical manufacturer Purdue Pharma. Purdue Pharma was forced to file for bankruptcy protection over its role marketing highly addictive opioid medications and has been restructured.
Ingles said in the letter that allowing Held to join its board would potentially lead to lost sales because of Summer Road’s connection with the Sackler family. Ingles also believes it would lose pharmacy and fuel sales in addition to opportunities to create value over the long term, according to the letter.
“We believe customers may choose to shop anywhere else but at a store whose Board includes a Sackler Representative – particularly if they have experienced the loss of a family member or friend due to the addiction caused by the Sacklers’ OxyContin,” Ingles said, referring to the brand name of an opioid-based painkiller Purdue Pharma developed and distributed.
Ingles urged shareholders to vote for its nominees, who include Dwight Jacobs, a former Duke Energy senior executive, and Rebekah Lowe, a former regional bank president.
Summer Road said that Held, if elected to the board, would push Ingles to consider breaking into two companies — one to handle its grocery operations and the other to own its real estate. According to Ingles’ annual report for fiscal year 2025, the company owns the property occupied by 174 of its supermarkets.
Held would also advocate for “an exhaustive, data-driven study” of how the company allocates data, Summer Road said, adding that it believes that returning capital to shareholders is likely the highest-return opportunity available to the company. In addition, Held would urge Ingles to reinstate quarterly earnings calls and make other changes to how it handles relationships with investors, according to Summer Road.
Ingles, which runs about 200 supermarkets in six Southeastern states, recorded net sales of $1.37 billion during the first quarter of fiscal 2026, up 6.6% compared with the same period during the prior year. Net income for the quarter rose almost 70%, to $28.1 million.
