Gildan Takes Aim at Ex-CEO’s Habits, Investments

Officers at Gildan Activewear Inc., which is embroiled in a bitter dispute with former CEO Glenn Chamandy, have begun digging by his emails to again up the board’s declare he was a “disengaged” govt.

Administrators on the Canadian clothes producer try to make the case they had been justified in firing the longtime chief govt officer in December. Amongst different issues, they’ve accused him of attempting to pursue high-risk acquisitions and turning into distracted by private initiatives, comparable to a golf course in Barbados.

“Gildan has now discovered that Mr. Chamandy despatched on common not more than a handful of labor emails a day and had few business-related conferences diarised on his calendar,” the corporate mentioned in a press release late Tuesday.

For the previous month, Gildan administrators have been concerned in an more and more hostile and public combat with Chamandy and numerous main shareholders who assist him, need him again as CEO and are in search of modifications to the board.

The dissident investor group is led by Los Angeles-based Browning West LP, which owns about 5 p.c of Gildan’s shares and final week requested a shareholder assembly to vote in a brand new board. Gildan has but to publicly reply to that request. To date, 9 shareholders holding greater than a 3rd of Gildan’s inventory have brazenly backed Chamandy’s return.

On Tuesday, the corporate additionally mentioned Chamandy positioned his personal cash into funds managed by one of many funding companies that’s now lobbying to deliver him again as CEO. It didn’t identify the agency, however an individual accustomed to the matter mentioned it’s not Browning West.

Chamandy “appears to have a detailed relationship” with Browning West, the corporate mentioned. The CEO hosted an “unique” go to to Gildan’s manufacturing plant in Honduras on Nov. 8, 2023 for Browning West co-founders Usman Nabi and Peter Lee, it mentioned.

Later in November, Chamandy despatched the board an “ultimatum” to approve a multibillion-dollar acquisition, which the board rejected, in keeping with the corporate’s model of occasions. Chamandy’s departure was introduced on Dec. 11.

In a press release Wednesday, Chamandy struck again, saying that the board is attempting to undermine him based mostly on “insinuation and distortion of the reality.” Gildan’s newest launch “continues to mirror an method that’s misguided, deceptive, and value-destructive, prioritising the obsession of board members with their very own reputations above all else,” he added.

Gildan’s market capitalisation has declined by greater than C$1 billion to C$7.2 billion ($5.3 billion) since Chamandy’s dismissal.

“The board’s more and more determined messages within the face of unprecedented shareholder backlash are failing to divert consideration away from substantive shareholder considerations,” Browning West mentioned in a press release emailed by an outdoor spokesperson. “It has probably develop into clear to all shareholders that the board is rather more centered on self-preservation than accepting shareholders’ views and creating worth.”

Vince Tyra, a former Fruit of the Loom govt, began as Gildan’s CEO on Monday. Gildan, headquartered in Montreal, owns the American Attire model.

By Mathieu Dion

Study extra:

American Apparel Goes Canadian as Gildan Buys Assets at Auction

Gildan will fold American Attire into its North American distribution networks to realize market share within the style fundamentals section of the market.