The transformation of Lunya, the beloved Catalonian Deli, Restaurant, and Bar in Liverpool, into an Employee Owned Trust (EOT) marks a groundbreaking shift in the UK hospitality sector. Under this government-backed model, the founders Peter and Elaine Kinsella will sell their shares to an EOT. This means the trust will hold all the shares of Lunya Ltd, which in turn will see future profits allocated to the new owners up to an agreed valuation. After reaching this valuation, profits will be directed in a manner akin to the John Lewis model, benefiting all staff members. This transition is designed not only to enhance employee engagement but also to secure the long-term future of the business.
A New Chapter for Lunya
Peter Kinsella, co-owner of Lunya, expressed his pride and optimism regarding the transition to an EOT, highlighting the importance of entrusting the business’s future to its dedicated employees. Founded in 2010, Lunya has earned a stellar reputation for bringing authentic Spanish flavors to the UK, creating a unique culinary and cultural experience. This transition to an EOT allows those who have played a significant role in the company’s success to reap the rewards of their hard work while also empowering them to influence its future growth and innovation. Peter and Elaine Kinsella’s decision reflects their deep appreciation for their employees and their commitment to fostering a collaborative and inclusive business environment.
Elaine Kinsella’s involvement in the business has diminished since her Myeloma diagnosis in 2021. The transition will see her step back even further while Peter plans to retire within the next seven years. During this period, he will gradually reduce his involvement in day-to-day operations. This phase-out plan is aimed at ensuring a smooth transition of leadership, allowing the new employee-owners the opportunity to shape Lunya’s future directions gradually. Tom Cavanagh, the Director of Operations, shared his gratitude for the founders’ generosity and expressed excitement about the opportunities ahead. Cavanagh emphasized the goal of maintaining Lunya’s status as one of the top Spanish restaurants in the UK.
Empowering Employees Through Ownership
The EOT model offers significant advantages by granting Lunya’s employees a greater say in the business’s strategic direction and a direct stake in its financial success. By fostering a culture of collaboration, innovation, and shared purpose, the EOT is expected to drive Lunya toward new levels of achievement. This model not only aligns employees’ interests with the success of the business but also encourages a sense of ownership and accountability that can lead to higher levels of job satisfaction and retention. Elaine Kinsella expressed hope that the EOT would promote long-term financial benefits for employees while contributing positively to staff retention.
The legal and financial arrangements for this significant transition were managed by Brabners LLP and Mitchell Charlesworth Accountants, respectively. Stephen Hadlow, a partner at Brabners, remarked that the move to employee ownership opens a promising new chapter for Lunya. Hadlow assured that the shift would not compromise the brand’s integrity and independence, which the Kinsellas have carefully built over the years. This successful adoption of the EOT model underscores its versatility as a succession strategy, proving it suitable for various industry sectors.
Long-term Impacts on Lunya’s Future
Lunya, the popular Catalonian Deli, Restaurant, and Bar in Liverpool, is making history by becoming an Employee Owned Trust (EOT), a notable first in the UK’s hospitality industry. Founders Peter and Elaine Kinsella will sell their shares to the EOT, transferring ownership to the employees. This government-endorsed model ensures that the trust will own all of Lunya Ltd’s shares, allowing future profits to be distributed among the employees up to a specified valuation. Once this valuation is met, profits will be shared in a manner similar to the John Lewis partnership, benefiting all staff members equally. This transformative move aims to boost employee involvement and ensure the long-term stability and success of the business. By adopting the EOT model, Lunya is not just changing ownership structure but also setting a precedent for other businesses in the sector, showing that employee ownership can be a viable and rewarding path. This transition is seen as a step forward in creating a more inclusive and sustainable business model in the competitive world of hospitality.