Business
Tuesday’s vote followed months of escalating corporate tensions and two failed mediation sessions.
Arthur T. Demoulas is out as Market Basket president and CEO following months of escalating corporate tensions and public mudslinging, the company’s board announced Wednesday.
Board members voted unanimously late on Tuesday to oust the embattled leader, who had been on paid leave since May amid an investigation into allegations that he and his allies were planning a work stoppage.
Specifically, the board suggested Demoulas intended to retaliate after board members demanded both access to key employees and collaboration “regarding the most basic corporate oversight.” They also raised concerns about transparency and succession planning in the family-run business.
A spokesperson for Demoulas did not immediately respond to a request for comment Wednesday morning.
A popular leader affectionately known as “Artie T.,” Demoulas saw a wave of support from some of his Market Basket deputies, dozens of the grocery chain’s employees, and even local elected officials.
The long-simmering corporate feud pitted Demoulas against his sisters, Caren Demoulas Pasquale, Frances Demoulas Kettenbach, and Glorianne Demoulas Farnham. While Arthur T. controls 28% of the company, his sisters wield a combined 60%.
Both sides headed to mediation Sept. 3 in hopes of settling their differences, to no avail.
“Despite extensive efforts by the Board and Mr. Demoulas to come to terms, the mediation was not successful,” Market Basket Board Chair Jay K. Hachigian said in a statement.
Hachigian said the board has filed in the Delaware Court of Chancery to make Demoulas’ removal official. Both sides had agreed not to comment publicly during the confidential mediation process, he said.
“We assure our valued associates and customers that, as we have demonstrated over the past several months, Market Basket will not change its operations, profit-sharing, bonuses or culture, and will continue to offer the best groceries at the lowest prices anywhere in New England — well into the future,” Hachigian said.
Still, Demoulas’ ouster could have lasting implications for the grocery chain. After he was removed from his job in 2014 over a similar family dispute, Market Basket workers staged protests and walkouts, and many loyal customers boycotted the grocer. Demoulas later reached a $1.6 billion deal to buy company shares from rival family members, restoring him to power.
This is a developing story and will be updated.
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