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By Barney Henderson
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Kroger Chairman and CEO Rodney McMullen has resigned after an internal investigation into his personal conduct.
The nation's largest grocery chain announced McMullen's resignation on Monday, clarifying that the investigation did not pertain to the company's business operations, financial performance, or reporting. It also emphasized that no Kroger employees were involved in the matter.
Veteran board member Ronald Sargent has been named interim CEO and chairman, effective immediately. Sargent, a director at Kroger since 2006, has served as the company's lead independent director since 2017. He previously held the top role at Staples, where he served as chairman and CEO.
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"I plan to be a steady, but active hand in the execution of our strategy," Sargent told the Wall Street Journal.
McMullen, 64, began his career with Kroger in 1978 as a part-time stock clerk and bagger in Lexington, Kentucky. Over more than four decades, he rose through the ranks, serving as chief financial officer in 1995 and chief operating officer in 2009. He was appointed CEO in 2014 and took on the role of chairman a year later.
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Kroger's board was alerted to the situation on February 21 and promptly engaged an external independent counsel to oversee an internal review, which was led by a special board committee.
The company said it will launch a search for a permanent CEO, with Sargent committed to leading in the interim until a successor is named.
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.
This article includes reporting from The Associated Press.
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