Kona Grill opens its first Minnesota restaurant: The Arizona chain, with many Twin Cities ties, finally opens one of its upscale
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KONA | Quote | Chart | News | PowerRating -- Kona Grill Inc., the struggling restaurant chain based in Scottsdale, Ariz., opens its first Minnesota restaurant today in Eden Prairie as the company continues searching for a CEO to replace Marcus Jundt. Jundt, a former Twin Cities money manager, quit Kona Grill in May amid a management-shareholder fight. Both he and his father, James Jundt, remain large shareholders in the publicly traded chain, said Mark Bartholomay, Kona Grill's interim CEO.
Bartholomay said he's a candidate for CEO. A former Twin Cities investment banker, Bartholomay was an executive at Rainforest Cafe Inc. and Famous Dave's of America Inc.
The new Eden Prairie eatery, the company's 23rd location, had been expected to open earlier. Kona signed the lease for the land more than two years ago, Bartholomay said.
The upscale grill dishes up sushi and American food and, in a nod to the land of lakes, has added walleye to the menu. Kona's average check is about $24, half the average bill at a McCormick & Schmick's but above the Cheesecake Factory's average of $18.50. Locally, it will compete with a nearby Champps, Redstone American Grill and Wildfire. Bartholomay said he expects the restaurant to be profitable within the first 12 months despite the tough economy because of its broad appeal and high-traffic spot near the Eden Prairie Center mall.
"It's a young, growing part of town," Bartholomay said.
Kona Grill has been wrestling for some time with Mill Road Capital, an investment company in Greenwich, Conn., and major Kona shareholder that has made multiple offers for the company. Earlier this year, Mill Road Capital accused Marcus Jundt of ethical lapses and mismanagement, including giving preferential treatment to his father in proposed stock sales -- charges Jundt denied in a conference call with industry analysts. Mill Road Capital also publicized the fact that shareholders with a majority of the company's voting shares withheld support for Jundt as a director. Jundt later resigned and Bartholomay was appointed interim CEO.
Kona's stock traded as high as $20 a few years ago but has languished in the range of $2 to $3 this year. The company's losses narrowed to $214,000 in the second quarter ended June 30. Same-store sales through June 30 were down nearly 10 percent.
Jennifer Bjorhus --612-673-4683
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