Dive Brief:

• Save A Lot CEO Kenneth McGrath is stepping down from his post and returning to Lidl, where he will serve as deputy chairman of its international business, the German publication Lebensmittel Zeitung reported. 
• In an emailed statement, Save A Lot confirmed McGrath’s upcoming departure, saying his resignation is due to “personal reasons in conjunction with his upcoming relocation back to Europe.”
• McGrath’s departure for the discounter where he previously spent 13 years, including serving as the CEO of Lidl’s Ireland and U.S. divisions, comes during a turbulent time for both Save A Lot and Lidl. 

Dive Insight:

McGrath is heading to Germany to oversee Lidl's retail operations during a time of significant change for the discounter, which recently announced the departure of one of its top generals, Klaus Gehrig.

According to reports, McGrath will start at Lidl on Oct. 1 and will report to Gerd Chrzanowski, who is taking over Gehrig's role as CEO of Schwarz Group, Lidl's parent company.

McGrath is leaving Save A Lot as the discount chain is selling off its corporate-owned locations and pivoting to a wholesale business model. The Missouri-based grocer recently announced an accelerated store remodeling effort.

“McGrath will remain with the company over the next few months, working closely with the Board of Directors and management team to ensure a smooth and effective transition to his successor,” Save A Lot said in an emailed statement.

McGrath nabbed the top spot at Save A Lot in 2017. Under his leadership, the company worked to gain more financial stability, closing underperforming stores and making job cuts. But it has struggled with a high debt load. In January 2020, the grocer said it reached an agreement with lenders to receive $138 million in capital to strengthen the business. 

McGrath previously was the CEO of Lidl Ireland from 2009 to 2013 and served as the first CEO of Lidl US from 2013 to 2015. He also has experience in wireless telecommunications from his time as the CEO of the Caribbean and Central America region at Digicel, where he oversaw 26 markets from 2015 to 2017. 

In addition to McGrath, Save A Lot also added another former Lidl executive, Kevin Proctor, to its executive team in 2017 — right as Lidl opened its first stores in the U.S. Since its debut, Lidl US has expanded to more than 130 stores and is one of the country's fastest-growing grocers, putting pressure on Save A Lot.

But Lidl US has experienced significant executive turnover since it began operations in 2013. McGrath's successor, Lidl Ireland veteran Brendan Proctor, was replaced in 2018 by Johannes Fieber. In April, the company named Michal Lagunionek, formerly head of the retailer’s Poland division, to fill the top role. Last year, Roman Heini resigned as chairman of Lidl’s U.S. division.