Deal reached to sell supermarket chain to ex-CEO

Market Basket employees Rees Gemmell, far right, and colleagues acknowledge passing supporters as they picket in front of the supermarket Thursday, July 24, 2014, in Haverhill, Mass.  A decades-long family feud, which brought about the ouster of Arthur T. Demoulas as CEO of the privately held company, led to a worker revolt, customer boycotts and empty shelves in the grocery chain's stores in Maine, Massachusetts and New Hampshire. More than 100 Massachusetts legislators and mayors, Massachusetts Attorney General Martha Coakley, and New Hampshire Gov. Maggie Hassan have publicly supported the employees. (AP Photo)
Market Basket employees Rees Gemmell, far right, and colleagues acknowledge passing supporters as they picket in front of the supermarket Thursday, July 24, 2014, in Haverhill, Mass. A decades-long family feud, which brought about the ouster of Arthur T. Demoulas as CEO of the privately held company, led to a worker revolt, customer boycotts and empty shelves in the grocery chain's stores in Maine, Massachusetts and New Hampshire. More than 100 Massachusetts legislators and mayors, Massachusetts Attorney General Martha Coakley, and New Hampshire Gov. Maggie Hassan have publicly supported the employees. (AP Photo)

TEWKSBURY, Mass. (AP) — A New England supermarket chain that has been in turmoil for weeks over a workers’ revolt and customer boycott has announced that the former CEO will buy a majority stake in the business.

Market Basket said in a statement late Wednesday that former CEO Arthur T. Demoulas would be returning to the company and that he and his management team would handle day-to-day operations while the purchase is completed.

The company’s two current CEOs, Felicia Thornton and Jim Gooch, are to remain in place until the deal is closed, the statement said. The closing is expected in the “next several months.”

Arthur T. Demoulas was ousted in June by a board of directors controlled by his cousin, Arthur S. Demoulas, causing workers to stage protests. Hundreds of warehouse workers and drivers refused to deliver food to the chain’s stores in Massachusetts, New Hampshire and Maine, leading to empty shelves and tens of millions in lost revenue.

In a joint statement Wednesday, Massachusetts Gov. Deval Patrick and New Hampshire Gov. Maggie Hassan said, “We are delighted that the parties have reached agreement on terms of sale and resolution of operating authority, so that employees can return to work and customers will once again be able to rely on these stores to meet their needs.”

The uproar over Arthur T. Demoulas’ firing prompted massive protest rallies outside the company’s Tewksbury headquarters. After the company fired eight supervisors who helped organize the revolt, public support for the workers intensified.

Thousands of customers, as well as more than 160 mayors and legislators in Massachusetts and New Hampshire, signed petitions agreeing to boycott Market Basket. The chain has about 25,000 employees and 71 stores in Massachusetts, New Hampshire and Maine. The stores, usually jam-packed with shoppers attracted by the chain’s low prices, have had only a trickle of customers for weeks.

Business analysts said the worker revolt was remarkable at a family-owned, non-union company, particularly because the workers were not seeking higher wages or better benefits, but instead were calling for the return of their CEO. The workers credit Arthur T. Demoulas for treating them like family, keeping prices low and leading the company’s success.

Renee Mulhane, a part-time Market Basket employee in Tewksbury, said late Wednesday she was hoping an agreement was reached so that she could return to the job she held for 13 years before being laid off two weeks ago.

“It has been inspiring the amount of support the public has shown,” the workers, she said. The situation has “been draining, but inspiring.”

Infighting in the Demoulas family has gone on for decades, but this was the first time the family’s squabble had such a deep impact on Market Basket stores.

The company’s new co-CEOs repeatedly urged employees to return to work, but they refused and insisted on the reinstatement of Arthur T. Demoulas.

Arthur T. Demoulas had offered to buy the 50.5 percent of the company owned by his cousin and other relatives on his side of the family. Demoulas had said Friday he had submitted his final bid to buy out his rivals’ share in the New England company on Aug. 21. Store managers and employees have expressed confidence since that a deal was imminent.

Market Basket stores have long been a fixture in New England. The late Arthur Demoulas, a Greek immigrant who was the grandfather of Arthur T. and Arthur S., opened the first store in Lowell nearly a century ago. Over the years, Market Basket became a favorite of frugal food shoppers. Today, the chain has 71 stores and about 25,000 employees.

Below is a state from Gov. Deval Patrick and New Hampshire Gov. Maggie Hassan:

“Market Basket is a major employer in Massachusetts and New Hampshire, and an important local resource for the communities the company serves. We are delighted that the parties have reached agreement on terms of sale and resolution of operating authority, so that employees can return to work and customers will once again be able to rely on these stores to meet their needs.”

Statement from UMass Lowell Chancellor Marty Meehan on Market Basket:

“Market Basket is back in the hands of the man who made it a national example of excellence in business management, customer service and employee loyalty. Arthur T. Demoulas not only grew a profitable company while offering the lowest prices in the market, he also created a unique culture in the retail industry through which customers and employees alike feel that they are part of a family.”

“Over the course of this crisis, we have seen the local economy take a hit as workers have lost wages, consumers have struggled to meet their grocery needs and many businesses beyond Market Basket have lost sales. Having this important locally based business back on track under the leadership of Arthur T. Demoulas is a huge win not just for the Merrimack Valley, but all of New England.”

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