Officials at Gildan Activewear Inc., which is embroiled in a bitter dispute with former CEO Glenn Chamandy, have begun digging through his emails to back up the board’s claim he was a “disengaged” executive.
Directors at the Canadian clothing manufacturer are trying to make the case they were justified in firing the longtime chief executive officer in December. Among other things, they’ve accused him of trying to pursue high-risk acquisitions and becoming distracted by personal projects, such as a golf course in Barbados.
“Gildan has now learned that Mr. Chamandy sent on average no more than a handful of work emails a day and had few business-related meetings diarised on his calendar,” the company said in a statement late Tuesday.
For the past month, Gildan directors have been involved in an increasingly hostile and public fight with Chamandy and a number of major shareholders who support him, want him back as CEO and are seeking changes to the board.
The dissident investor group is led by Los Angeles-based Browning West LP, which owns about 5 percent of Gildan’s shares and last week requested a shareholder meeting to vote in a new board. Gildan has yet to publicly respond to that request. So far, nine shareholders holding more than a third of Gildan’s stock have openly backed Chamandy’s return.
On Tuesday, the company also said Chamandy placed his own money into funds managed by one of the investment firms that’s now lobbying to bring him back as CEO. It didn’t name the firm, but a person familiar with the matter said it’s not Browning West.
Chamandy “seems to have a close relationship” with Browning West, the company said. The CEO hosted an “exclusive” visit to Gildan’s manufacturing plant in Honduras on Nov. 8, 2023 for Browning West co-founders Usman Nabi and Peter Lee, it said.
Later in November, Chamandy sent the board an “ultimatum” to approve a multibillion-dollar acquisition, which the board rejected, according to the company’s version of events. Chamandy’s departure was announced on Dec. 11.
In a statement Wednesday, Chamandy struck back, saying that the board is trying to undermine him based on “insinuation and distortion of the truth.” Gildan’s latest release “continues to reflect an approach that is misguided, misleading, and value-destructive, prioritising the obsession of board members with their own reputations above all else,” he added.
Gildan’s market capitalisation has declined by more than C$1 billion to C$7.2 billion ($5.3 billion) since Chamandy’s dismissal.
“The board’s increasingly desperate messages in the face of unprecedented shareholder backlash are failing to divert attention away from substantive shareholder concerns,” Browning West said in a statement emailed by an outside spokesperson. “It has likely become clear to all shareholders that the board is much more focused on self-preservation than accepting shareholders’ views and creating value.”
Vince Tyra, a former Fruit of the Loom executive, started as Gildan’s CEO on Monday. Gildan, headquartered in Montreal, owns the American Apparel brand.
By Mathieu Dion
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