Market Basket CEO Arthur T. Demoulas Ousted After Mediation Fails

Market Basket fired its CEO, Arthur T. Demoulas, following a prolonged power struggle with his sisters. The move raises questions about the company's culture, leadership, and outlook.

The Market Basket board of directors, appointed by the three Demoulas sisters who own a controlling interest in the company, said they fired Demoulas after mediation failed to address longstanding issues of control and succession.

In a lawsuit filed in Delaware business court on Wednesday, Sept. 10, board members stated they had to choose between accepting Demoulas's complete control of the company or ensuring the growth of the business for the long term.

Admired by many of the Tewksbury-based company's more than 30,000 employees, Demoulas is regarded as one of the most savvy and successful grocery chain operators in the country. A rift with his three sisters in recent years, however, came to the forefront a year ago when Market Basket's board of directors began asking for more financial information from Demoulas amid reassurances that none of his children would succeed him. 

Justine Griffin, a spokesperson for Arthur T. Demoulas, said in a statement shared with The Boston Globe that Demoulas “is deeply disappointed that mediation failed” despite his efforts to come to a resolution.

“Over time, it became clear to us that this was not a good faith effort by the board or his sisters to reach agreement on the issues created by their abrupt actions placing Arthur T. Demoulas, his family, and members of his senior management team on leave,” Griffin added. “It is now crystal clear that they had no intention of reinstating Mr. Demoulas.”

With this recent turn of events, Market Basket board chair Jay Hachigian said in a brief media statement that “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.”