Market Basket board suspends CEO for alleged resistance to succession plan, CEO claims hostile takeover attempt
Photo | Timothy Doyle
Market Basket's Shrewsbury location
Arthur T. Demoulas, president and CEO of Market Basket, has been suspended by the company’s board of directors for allegedly resisting a succession plan and attempting to organize a worker stoppage, with Demoulas firing back with claims the board is attempting a hostile takeover.
Demoulas was suspended along with his daughter Madeline, his son Telemachus, and several other Market Basket executives, according to a statement released by Justine Griffin, spokesperson for Demoulas, on Wednesday. Demoulas claims three board members appointed by his sisters were responsible for the move.
A statement released earlier on Wednesday by the company alleges he was leading an effort to start a worker stoppage in protest of the board’s efforts to implement a succession plan, which would prevent him from unilaterally appointing one of his children to succeed him.
“The executive committee believes that Mr. Demoulas and others have taken these steps as improper retaliation for the board’s directives requiring the CEO to work with the board regarding the most basic corporate oversight and to provide the board access to key employees,” the statement reads. “Mr. Demoulas has also resisted an appropriate succession plan for Market Basket, asserting that he has the unilateral right to appoint his children to succeed him without any consideration of the view of the board or the majority owners of Market Basket.”
In his statement, Demoulas claimed the suspension was part of a hostile takeover attempt.
“Today, Arthur T. Demoulas was ousted from his position as president and CEO of Market Basket by his three sisters and their three appointed board members – Jay Hachigian, Steven Collins, and Michael Keyes,” the statement reads. “Under Mr. Demoulas’ leadership in December of 2024, the company paid off $1.6 billion in debt that financed the purchase of the company in 2014. The company is currently operating at its peak performance, and the notion that this board is going to conduct an investigation is a farcical cover for a hostile takeover.”
The family scuffle is reminiscent of a situation in 2014, where a long-standing feud over business practices between Arthur T. Demoulas and his cousin Arthur S. Demoulas resulted in Arthur T. being fired by the board controlled by Arthur S. The move resulted in widespread protests from shoppers and workers alike, eventually resulting in the company being sold to Arthur T. for approximately $1.6 billion, according to CBS News.
Market Basket has 95 locations across Massachusetts, Maine, New Hampshire, and Rhode Island, with Central Massachusetts locations in Ashland, Athol, Bellingham, Fitchburg, Hudson, Leominster, Littleton, Maynard, Oxford, and Shrewsbury.
Headquartered in Tewksbury, the company was founded by Greek immigrants Athanasios and Efrosini Demoulas, who opened its first grocery store in Lowell in 1917 under the name The Acre.
Eric Casey is the managing editor at Worcester Business Journal, who primarily covers the manufacturing and real estate industries.
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