Market Basket CEO Booted Is This the End of the Low-Price Empire?

Market Basket Board Places CEO Arthur T. Demoulas and Five Others on Paid Leave Amidst Family Feud

The saga continues at Market Basket, the beloved New England grocery chain. In a surprising turn of events, the company's board of directors has placed CEO Arthur T. Demoulas and five other employees on paid administrative leave, igniting yet another chapter in the ongoing family battle for control. The move, announced Wednesday, has sent ripples through the company and its loyal customer base.

Allegations of a "Work Stoppage"

According to the board's executive committee, Arthur T. Demoulas and the other suspended employees were allegedly preparing a work stoppage as "improper retaliation" against recent board directives. Steven Collins, a Market Basket board member and private equity executive, didn't mince words, stating, "Some have made the analogy that it's as if the CEO was holding the company hostage."

The board has initiated a formal investigation into these serious allegations.

Underlying Tensions and Succession Concerns

Collins revealed that the dispute has been brewing for some time, stemming from concerns about Demoulas allegedly making unilateral decisions, including positioning his children to succeed him upon his eventual retirement. This has apparently created friction within the board.

Justine Griffin, a spokesperson for Demoulas, countered that his three sisters and their appointed board members are the driving force behind the CEO's suspension. She stated that Demoulas’s daughter and son were among the other Market Basket executives placed on leave.
“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,” Griffin said in a statement.

Key Points of Contention

Collins highlighted a list of requests made to Demoulas last year, which were reportedly unmet:

• Creating an annual budget.
• Giving the board more input into capital expenditures.
• Collaborating on succession planning.

"Not a single one was met," Collins asserted.

Reassurances Amidst the Turmoil

Despite the upheaval, the board has assured employees and customers that operations will continue smoothly. Demoulas will receive his full salary and share in company distributions during his leave. Moreover:

• Workers will not experience any salary or benefit changes.
• The popular profit-sharing plan, a source of contention in the past, will remain in place.

A History of Family Feuds

The Demoulas family, which founded Market Basket a century ago in Lowell, Massachusetts, is no stranger to internal conflict. Over the years, various family factions have engaged in protracted legal battles and public disputes for control of the company. In 2014, the board's removal of Arthur T. Demoulas, a beloved figure among employees, sparked massive walkouts, protests, and boycotts. That crisis ended when Arthur T. and his siblings bought out their cousin, Arthur S. Demoulas, taking on $1.6 billion in debt, which was finally paid off last year.

Current Ownership Structure

Currently, Demoulas owns 28% of the company, while his three sisters control 60%. The remaining 12% is held by a family trust.

A Unique Situation

Collins characterized the latest battle as a typical board-CEO disagreement but acknowledged the extraordinary passion that employees and customers have for Market Basket, making the public deeply invested in the outcome. "I think this is unique because Market Basket is such a tremendous company and means so much to people," he stated. While Collins downplayed the potential impact on customers, he could not provide a timeline for the investigation's completion.

The Market Basket saga is a testament to the complex interplay of family, business, and community. While the future remains uncertain, one thing is clear: the loyalty and passion surrounding this iconic grocery chain will undoubtedly play a significant role in shaping its next chapter.

Tags: Market Basket, Arthur T. Demoulas, CEO, grocery chain, board dispute, work stoppage, investigation, Steven Collins, executive leave, family battle

Source: https://www.wbur.org/news/2025/05/28/market-basket-arthur-t-investigation