Like two other institutional shareholders this week, Gildan’s largest shareholder is in turn calling for the return of Glenn Chamandy at the helm of the Montreal clothing manufacturer.
Montreal asset manager Jarislowsky Fraser, who owns a 7% stake in Gildan, says he strongly opposes the board’s recent decision to fire Glenn Chamandy.
The board showed Glenn Chamandy the door on Sunday and named Vince Tyra, a 58-year-old American, to take over. He is due to take up his post on February 12.
“The continued leadership of Glenn Chamandy is essential for the company to successfully complete its important expansion and innovation program,” said Charles Nadim, head of research and portfolio manager at Jarislowsky Fraser, in a communication written sent to The Press.
The abrupt dismissal of Glenn Chamandy at the age of 61 to recruit a 58-year-old executive to lead the company into the next stage of its growth is concerning.
Charles Nadim, head of research and portfolio manager at Jarislowsky Fraser
“The board’s press release regarding Vince Tyra’s career does not paint a fair picture for shareholders and the decision was not made with sufficient diligence when evaluating his performance. Vince Tyra has not worked in the apparel industry since 2005 and does not have the relevant manufacturing expertise, which is Gildan’s primary competitive advantage,” he adds.
Jarislowsky Fraser calls for the resignation of board chairman Donald Berg and urges the board to reinstate Glenn Chamandy as CEO of Gildan, “where he could continue mentoring internal candidates in establishing of a comprehensive succession plan that will result in an orderly transition of leadership of the company to ensure its long-term success.”
It was not immediately possible to obtain a reaction from Gildan.
On Thursday, Turtle Creek Asset Management, a Toronto asset manager and Gildan shareholder for a decade, and Browning West, a Los Angeles investment firm, sent a letter to Gildan’s board of directors to ‘urge to reappoint Glenn Chamandy as CEO.
Jarislowsky Fraser, Turtle Creek and Browning West are among Gildan’s 10 largest shareholders.
In interview with The Press Earlier this week, the chairman of the board, Donald Berg, explained the departure of Glenn Chamandy by a divergence on the timing of the implementation of the company’s succession plan.
Donald Berg stressed Monday that the time is right for a change because the company is doing “very well, gaining market share and has a good plan in place for the next few years.”
Donald Berg says he tried in vain to agree with Glenn Chamandy on when he would retire in order to achieve a harmonious transition.
Glenn Chamandy said Monday that he was not granting an interview, but nevertheless indicated that he finds it “regrettable” that his vision of the future differs from that of the other members of the board and that the company is ending to his employment contract “without reason”.