Latest salvo in fight between directors and major shareholders
Author of the article:
Bloomberg News
Mathieu Dion
Published Jan 09, 2024 • Last updated 44 minutes ago • 2 minute read
Gildan apparel at a store in Montreal. Some investment firms that are among the largest shareholders of clothing manufacturer Gildan Activewear Inc. are taking aim at the board for its decision to oust chief executive Glenn Chamandy. Photo by Graham Hughes/Bloomberg
Gildan Activewear Inc.’s ousted chief executive fired back at the board over their recent letter questioning his leadership, saying he took offence at their action and blasting them for disclosing the clothing company’s confidential plans.
“The board’s self-serving motives, designed to distract from its own recklessness, have led them to lose sight of what is truly important — the best interests of the company,” former chief executive Glenn Chamandy said in a letter Tuesday.
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After two decades at the helm of the Montreal-based manufacturer, which owns the American Apparel brand, Chamandy was removed on Dec. 10 and replaced by former Fruit of the Loom executive Vince Tyra.
Chamandy’s termination has kicked off an epic governance battle, with investors holding more than a third of the shares speaking publicly against his firing and pressuring the board to reinstate him. Gildan’s board has countered that Chamandy was jeopardizing the company’s future with a multibillion-dollar acquisition strategy, had became “disengaged” as he focused on personal pursuits and violated policies about safeguarding corporate information after his departure.
Chamandy fired back on Tuesday, saying it was “disheartening that the board has decided to weaponize strategic confidential information of the company for the sole purpose of entrenching itself in power, with no regard for impact on value.”
Gildan didn’t immediately respond to a request for comment.
Investment firm Browning West LP is seeking to replace the majority of the board and on Tuesday asked that a special shareholder meeting to vote on new directors be held “without delay,” alleging that the board seeks to delay any such meeting as late as the fall.
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Browning West also expanded its slate of alternative director candidates from five to eight, adding former Nike Inc. chief risk officer Michener Chandlee and Canadian National Railway Co. chief financial officer Ghislain Houle to a list that already included United Rentals Inc. chair Michael Kneeland as proposed chair.
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The Los Angeles-based firm, which is backed by several other shareholders, said it recently increased its stake in Gildan to about five per cent.
“With each passing day, the current state of uncertainty is risking permanent damage to Gildan stakeholders,” Browning West said.
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