Update: Arthur T. Demoulas and his side of the family have made an offer to purchase the 50.5% of the stock held by his relatives who ousted him. There is an informative article on this in 7/24/14 Boston Globe, and terms (the purchase price offered) were not disclosed. Here are a few thoughts and opinions on this development:
• It’s a brilliant strategic move to solve the long term situation, because even if Arthur T. does come back, but without making this purchase, it’s just back to the status quo, with him as CEO but the opposing side of the family controlling a majority of the voting stock and the Board. There could then be a ‘next time’, and this time the other side will be more prepared and strategic. This purchase would allow the preservation of the Market Basket business model to continue after his retirement, and prevent his return as CEO from being just a tactical retreat by the Board of Directors.
• Arthur T. is now in a strong position because the company’s value will be greater with him back at the helm and the current strife over. Public opinion is firmly on his and the associates’ side, and customers are patronizing other supermarkets--the boycott is succeeding and growing. Financially Market Basket needs Arthur T. Demoulas back.
• There are major impediments to the purchase, mainly the ill will between the sides of the family. It’s always tricky to determine a selling price, but this situation is complicated by the fact that Arthur T. buying the company immediately makes it worth more, since he’s then back as CEO and the associates’ rebellion and the customers’ boycott end. The current situation is a public relations and financial nightmare for the board, which leads into the next point.
• Perhaps most interestingly, this whole unfortunate situation, including Arthur T. losing his position as CEO and the accompanying rebellion, is exactly what has made this offer possible. Without the current turmoil, there was probably no chance the other side of the family would have sold out. Now maybe they will accept. One of the truest sayings ever is “you never know how things will work out”.
Update: The final and hopefully biggest rally will be held tomorrow (Friday, 7/24) at 9:00 AM in the parking lot of Store #8 in Tewksbury. Set your GPS to 10 Main Street, Tewksbury, MA 01876. The last rally got off to a late start thanks to gridlock on Route 495. You should get there early enough to avoid parking in a tow away zone, although the police were reasonably accommodating, considering what a crowd they had to deal with. More details are available here.
Comment: One commenter noted that he used to work for Albertsons before it was sold to Supervalu, but Albertsons is now back as an independent chain again—it was sold again and purchased from Supervalu by a private equity group.
A good article from the Globe on the purchase process and recent interest from other groups in purchasing Market Basket
On a personal note, thanks for the comments and all everyone is doing to keep Market Basket the great grocery chain it has always been. My in-laws are completely, 100% loyal Market Basket shoppers--this has put them in a predicament. Now they are not shopping anywhere, so they are running out of food in the house and spending more money eating out. For their sake I hope it resolves soon.