By MICHELLE CHAPMAN, AP Business Writer
Kroger Chairman and CEO Rodney McMullen has resigned after an internal investigation into his personal conduct.
Kroger, the nation’s largest grocery chain, said Monday that the investigation into McMullen’s personal conduct was unrelated to the business, but was found to be inconsistent with its business ethics policy.
Board member Ronald Sargent will serve as chairman and interim CEO, effective immediately.
Sargent has been on Kroger’s board since 2006 and has served as the lead director of the company since 2017. He’s worked in several roles at the grocery chain across stores, sales, marketing, manufacturing and strategy. Sargent is also the former Chairman and CEO of Staples.
McMullen, 64, began his career with Kroger in 1978 as a part-time stock clerk and bagger at a store in Lexington, Kentucky. He worked his way up through the company, becoming chief financial officer in 1995 and chief operating officer in 2009. McMullen was named Kroger’s CEO in 2014 and became the company’s chairman the following year.
Cincinnati-based Kroger said its board was made aware of the situation on Feb. 21 and immediately hired an outside independent counsel to conduct an investigation, overseen by a special board committee.
The company said that McMullen’s conduct is not related to its financial performance, operations or reporting, and did not involve any Kroger associates.
Kroger will conduct a search for its next CEO, with Sargent agreeing to remain as interim CEO until someone is appointed to the role permanently.
Kroger shares fell more than 3.5% ahead of the opening bell Monday.
McMullen’s departure comes as Kroger is regrouping from its failed effort to merger with Albertsons. The two companies proposed what would have been the largest supermarket merger in U.S. history in 2022, saying they needed to combine forces to better compete with rivals like Walmart.
But two judges halted the $24.6 billion deal in December, saying it was likely to lessen competition and raise prices. Albertsons later sued Kroger, saying it had failed to make every effort to ensure that the merger would win regulatory approval.
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