Market Basket CEO faces vote on ouster
In a reprise of the bitter fighting that has riven the family in charge of one of the state’s largest supermarket chains, the board of the Market Basket food stores is poised to fire chief executive Arthur T. Demoulas at a meeting next week.
The company’s board, split between two sides of a family long at war, will take up a motion for his removal next Thursday, resurrecting a notorious and seemingly intractable feud over the highly successful Demoulas Super Markets Inc.
In the latest dispute, the faction that opposes Demoulas, led by his first cousin, has gained control of the board and is accusing him of steamrolling directors and spending money recklessly, including transactions with companies owned by his wife and brothers-in-law. They argue he must be removed to restore the board’s authority.
In a recent interview, Arthur T. Demoulas, 58, said Market Basket has performed well under his tenure, recording net income of $217 million in 2012 on $4 billion in revenue. He asserted the deals involving his wife and brothers-in-law were fully vetted, and that relatives who oppose him are trying to enrich themselves at the company’s expense.
His attorney asserted that those opponents have repeatedly pushed for Market Basket company to borrow heavily in order to finance payouts to shareholders of more than $1.5 billion.
This is the latest flashpoint in a two-decade battle within the Demoulas family over the Market Basket chain. Although the original battle in the 1990s was won by the offspring of George Demoulas, including his son, Arthur S. Demoulas, its management has remained divided between two sides of the family.
Arthur S. Demoulas and other family members recently gained the upper hand in a board election, and began pressing for Arthur T. DeMoulas’ removal.
The matter landed in Suffolk Superior Court in June after board members who support Arthur T. DeMoulas failed to appear for board meetings to consider his removal, preventing a quorum needed for directors to take action. Judge Linda E. Giles then issued an order for meeting to be held on July 18.