A Toronto shareholder of Gildan is increasing pressure on the board of directors of the Montreal clothing manufacturer by imploring it to convene a meeting without delay to hold a vote on the return of Glenn Chamandy to the post of CEO and the reconstitution of the board.
In an open letter to Gildan’s board released Monday, asset manager Turtle Creek tells directors they have no right to prevent shareholders from voting for those they want to represent them.
“Hold the meeting of shareholders of Gildan, as you are required to do under the law, to allow shareholders to vote on the composition of the board of directors,” it is mentioned in the missive supporting the request meeting made earlier this month by American shareholder Browning West.
This letter is published after the Gildan board accused Browning West, the day before, of having illegally accumulated shares of Gildan, thus undermining the legitimacy of this shareholder to request the holding of a special meeting of shareholders. Browning West quickly refuted Gildan’s CA accusations on Sunday.
Turtle Creek contends that the Gildan board’s public relations campaign is “destructive,” made up of “inferences and innuendoes,” and “is frankly embarrassing to the company and to every member of the board.”
“There is still time to change course and preserve your professional reputation. Don’t let your advisors pressure you into engaging in an ugly, expensive proxy fight that you are unlikely to win,” the document reads.
PHOTO PATRICK SANFAÇON, LA PRESSE ARCHIVES
Glenn Chamandy
Glenn Chamandy was removed as CEO on December 10. The board justified its decision by differences related to the succession plan and by emphasizing that Glenn Chamandy wanted to move forward with a risky multi-billion dollar acquisition strategy.
Around ten independent institutional shareholders, controlling approximately 35% of Gildan’s shares, have publicly expressed their opposition to the dismissal of Glenn Chamandy in recent weeks.
The power struggle at Gildan is becoming increasingly acrimonious. Shareholders have been bombarded with documents since the dismissal of Glenn Chamandy last month. The board of directors and dissident shareholders throw press releases and letters at each other, often responding within hours to new allegations.
Gildan’s annual general meeting of shareholders is usually held in May each year.
