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August 12, 2014

Ex-Market Basket CEO: Board declined purchase offer

Arthur T. Demoulas, the former CEO of the Mass.-based Market Basket supermarkets, said the company’s board has rebuffed his offer to purchase a majority share of the company.

The Portland Press Herald reported that Demoulas, who remains minority owner of the company and was ousted by the board in June, said in a statement that the board declined his offer to buy the company for the asking price, which amounts to the value of the company and its 71 New England stores before customer boycotts and staff reductions began.

Demoulas said board members instead offered “counterproposals that have been laden with onerous terms that are far beyond comparable transactions,” though he did not specify the exact conditions which he deemed were unacceptable. Last week, Demoulas and his management team refused an offer by the board to return in a diminished capacity.

The owners of the supermarket chain are still considering purchase offers from potential buyers, including Delhaize Group SA of Belgium, the parent company of Market Basket competitor Hannaford Bros.

Many of the company’s nearly 25,000 employees have been protesting the board’s decision to fire Demoulas since June, saying they won’t return unless he is reinstated.

A large number of the company’s part-time employees, including around 270 at its only Maine store in Biddeford, have been effectively laid off in response to a directive by the company’s CEOs Felicia Thornton and James Gooch to “manage payroll” in response to the three-week protest that has caused sales to plummet by 90% at many stores.

In firing Demoulas, Market Basket's board said that he was overspending and failing to follow board directives. But protesters have supported the ousted CEO in part because of his commitment to keep the chain family-owned and retain fair pay for employees — with experienced cashiers reportedly making $40,000 and full-time clerks starting at $12 an hour.

Before this summer’s boycott had begun, the supermarket chain's entry into Maine had been projected to drive down prices in competing stores as more non-traditional stores vie for the food-purchasing dollars of grocery shoppers, as reported by Mainebiz.

Read more

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Large protest expected for Market Basket in Mass.

Amid Market Basket layoffs, a bidder reportedly in the wings

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