Bidder competing with Arthur T. Demoulas for Market Basket

An unnamed supermarket company has made an offer to buy the Market Basket grocery chain,

the

Boston Globe

reported.

The bidder is competing with Arthur T. Demoulas, who was fired as president by the board, a majority of whom sided with his cousin and rival, Arthur S. Demoulas.

Arthur T. and his side of the family are not interested in selling their 49.5% stake in the company, so the outside bidder, if successful, would own only a 50.5% stake, the


Globe


article said. The suitor has expressed a willingness to acquire part or all of the company, which operates 71 stores, the article said.

Citing unidentified sources, the


Globe


report said the bids from Arthur T. and the other supermarket company are close in value. The article said:

“The bidding competition could make it more difficult for Arthur T. to regain control of the business, especially given his strained relationship with Arthur S. and other relatives who have rebuffed his efforts to reach a sale agreement and repair operations.”

Clark University professor Gary Chaison told the


Globe


that if the outside majority owner installed its own CEO, it would have to deal with angry employees, who have staged demonstrations and work stoppages in protest of Arthur T.’s removal. If the new buyer reinstated Arthur T., the outside company “can basically never get rid of him if it doesn’t work out,” Chaison said.

Northwestern Law School professor James J. Hanks told the


Globe


that an outside buyer could appoint Arthur T. to an advisory board and keep him involved in decision making while an outside CEO runs the company, although it would be more likely that a new owner would “play hardball” in an effort to acquire Arthur T.’s shares.

The


Globe


report said the company is losing millions of dollars a day because of the employee walkout. The article said it is unclear whether bids for the company would be lowered because of the losses.

Kevin Griffin, publisher of the


Griffin Report on Food Marketing


, told the


Globe


, “It just seems like [Arthur S.] wants to sell to anyone but Arthur T.”  (Source:


Boston Globe


, August 7, 2014.)