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Tuesday, August 19, 2014

Gov. Hassan joins Market Basket negotiations; seafood vendor makes a public break with the company

NASHUA – New Hampshire Gov. Maggie Hassan met Sunday with Arthur T. Demoulas, Arthur S. Demoulas and other stakeholders from the Market Basket grocery chain, taking her most direct role to date in the ongoing negotiations over the future of the supermarket company.

Hassan joined Massachusetts Gov. Deval Patrick in Springfield, Mass., to try to broker an agreement between shareholders allied with the two rival factions of the Demoulas family. ...

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NASHUA – New Hampshire Gov. Maggie Hassan met Sunday with Arthur T. Demoulas, Arthur S. Demoulas and other stakeholders from the Market Basket grocery chain, taking her most direct role to date in the ongoing negotiations over the future of the supermarket company.

Hassan joined Massachusetts Gov. Deval Patrick in Springfield, Mass., to try to broker an agreement between shareholders allied with the two rival factions of the Demoulas family.

“The parties have made real progress on the terms of the sale and operating control of the company, and the governors are encouraged that a resolution may be within reach,” Patrick’s press secretary, Heather Nichols, wrote in a statement released Monday.

Arthur T. Demoulas is spearheading a bid to buy-out the 50.5 percent of shares in the company controlled by his cousin. While both sides appear to agree on a sale price, they remained divided over the terms of the deal.

Market Basket employees launched a series of ongoing protests against the company’s new leadership last month after Arthur T. Demoulas was ousted as the head of the company, calling for the expelled CEO and his leadership team to be reinstated. Joining the two governors in Springfield Sunday were representatives affiliated with both Demoulas cousins, as well as Demoulas Supermarkets Board of Directors Chairman Keith O. Cowan and Tina Albright, who was representing one of the so-called “Class A shareholders” allied with Arthur S. Demoulas.

“This is a private business dispute, but the Governor is hopeful that the leaders at Market Basket will come together and reach a constructive resolution that keeps their workers employed and reduces the impact on consumers and other affected businesses,” Hassan spokesman William Hinkle said in a statement.

While the turmoil is taking a toll on Market Basket’s bottom line, it also has impacted the company’s suppliers.

On Monday, the owners of Boston Sword & Tuna, a seafood and shellfish supplier, announced they will no longer do business with Market Basket’s current management.

Founded in 2003 and headquartered in Boston, the company provides salmon, cod, haddock, scallops, swordfish and tuna to markets around New England.

In a message posted on Facebook, a representative of Boston Sword & Tuna said the company was suffering from the loss of income it would normally receive buying 25,000 to 30,000 pounds of fish for Market Basket. It also has struggled to find buyers for an extra 25,000 pounds of farmed salmon that can no longer be shipped to Market Basket stores.

“We were forced to significantly discount the fish to sell it,” reads a message from the company. “Between that and the loss of wild seafood sales, we were looking at the possibility of layoffs of up to a dozen or more employees.”

Market Basket agreed to compensate the company for a portion of its weekly losses, and to repay outstanding contract costs, according to Boston Sword & Tuna. In the weeks that followed, the company had trouble reaching Market Basket management, according to the Facebook message, and on two separate occasions, after orders were placed, the company was overpaid by thousands of dollars.

The second time, a check carried to the company by a Market Basket security officer was made out for $415,000 more than the company was owed, according to the Facebook message.

The sizable error left Boston Sword & Tuna’s owners suspecting that Market Basket’s majority shareholders were calling the shots behind Market Basket’s business decisions, and that their aim was to sink the company before turning it back over to Arthur T. Demoulas, selling him “a pile of smoking rubble.”

“Going public with these facts has been a very difficult decision for us. We have enjoyed a business relationship with Market Basket, its former owners and buyers, which many in business never get to experience. We think the time has nearly run out for saving this great institution and all those who depend on it,” the message reads.

Gov. Hassan was among the first high-ranking politicians to address the grocery store feud after it erupted last month. She called on the company’s executives to listen to employees, saying New Hampshire consumers have benefitted from the strong bond Market Basket formed with its workers through “fair treatment, support and respect” in the past.

Hassan made a second public statement in early August, soon after Market Basket notified its legion of part-time employees that they would no longer be scheduled for work.

With the change affecting some 8,000 New Hampshire employees, Hassan called the cutbacks “incredibly troubling” and urged workers to apply for jobless benefits.

Jim Haddadin can be reached at 594-6589 or jhaddadin@nashua
telegraph.com. Also, follow Haddadin on Twitter (@Telegraph_JimH).