ENDORSEMENTS
With respect to the forthcoming proxy vote, we hope for a compromise, but at this time, neither party appears open to such resolution. Should that be the case, we believe that shareholder value is likely to be most enhanced, in order, by: 1) Browning West reconstituting the Board; 2) a potential sale transaction; and 3) the incumbent Board remaining in place.
Browning West appears to have an impressive track record of value creation for shareholders. In our view, Gildan can grow its EPS in the low teens (10-14%) on flawless execution. We believe that a return of Glenn Chamandy as CEO of Gildan is the best course of action for Gildan’s stock price.
Nine shareholders, representing approximately 35% of Gildan’s outstanding common shares, have publicly voiced that change is desperately needed with many stating that they intend to support Browning West’s slate.
If a meeting of Gildan shareholders were held today, we have a high level of confidence that the shareholders would vote overwhelmingly in favor of the individuals nominated by Browning West LP… We and other shareholders do not trust the current Board to act as independent fiduciaries for us. We demand the Board hold the annual meeting of shareholders on an urgent basis and allow shareholders to elect a new Board before further, permanent harm is caused to the Company. We remain steadfast in our resolve to see substantial Board change.
[Browning West’s director candidates are] all industry heavyweights… two or three of them have got a lot of experience with succession, having worked with founders in the past, and obviously having come through what we just came through, that’s very much needed at Gildan.
…Cooke & Bieler LP told The Globe that they, too, are backing Browning West’s updated proposals and expanded board slate. They represent ‘the best path forward for Gildan.'
Jarislowsky Fraser, Gildan’s biggest shareholder, also supports the expanded Browning West slate, company spokeswoman Quyn Pham said...
Another major shareholder, London-based Janus Henderson, backs the expanded slate as well, according to information obtained by The Globe and Mail.
Jarislowsky Fraser intends to support Browning West and its intent to requisition a Special Meeting of Gildan Shareholders to appoint five new director candidates.
Turtle Creek has had the opportunity to independently review the backgrounds and qualifications of each of the nominees disclosed by Browning West… and believes that they will add much needed accountability, skills, experience, and a shareholder-focused perspective to the Board. Turtle Creek intends to vote in favour of each nominee at the Special Meeting and believes a substantial majority of other shareholders conducting their respective independent reviews of the nominees will arrive at the same conclusion.
New York-based Oakcliff Capital followed with its own letter to Gildan, pledging to vote for Browning West’s slate of directors. The firm said the sale of shares by some other members of Gildan’s management team pointed to a lack of confidence. Chamandy “should be reinstated as CEO immediately…
We were shocked by the board's decision to terminate Chamandy's employment contract. We are concerned with the credibility of the board's narrative, which focused first on succession and then shifted to a risky acquisition allegedly proposed by the CEO. Neither of these reasons are typical for the dismissal of a successful CEO who wants to stay with the company.
We question the succession plan of hiring a new CEO who is only a few years younger than Chamandy and whether the alleged acquisition could have simply been voted down, a far less dramatic option than relieving the CEO of his duties.
In light of this strong support, and to avoid further distraction for Gildan, we ask the board to reinstate Chamandy as CEO immediately.
We call for Glenn Chamandy to be reinstated as CEO of the company…Failing to bring back Chamandy, who’s been running the business for decades, ‘would expose shareholders to risks including further executive departures, loss of strategic and operational insight, impairment of employee goodwill, and weakening of customer relationships…
We disagree with the Board's decision to remove Mr. Chamandy as CEO given his strong track record of value creation, and are calling for his immediate reinstatement and the implementation of a formal succession planning process including the engagement of Company shareholders.
The Board's mishandling of the succession planning process to date and its actions thereafter have resulted in an incredibly value-destructive distraction that must be immediately addressed. We are further troubled by the Board's decision to strike a backroom deal granting an individual shareholder a board seat in exchange for their support before engaging with other investors to discuss the Company's approach to succession planning. Instead, Company shareholders had to read about the Board's views on Mr. Chamandy in press reports, which we have since learned are false accusations. Specifically, the Board's commentary regarding M&A appears designed to perpetuate this distraction at the cost of what should be its key focus: succession planning.
We believe the best course of action is to immediately reinstate Mr. Chamandy, especially considering Vince Tyra seemingly lacks the skills required to lead Gildan into its next stage of growth.
Cooke & Bieler LP, which holds nearly 6% of Gildan’s shares, is also backing a return of Chamandy and believes that Chairman Donald Berg would have to go...
We believe that Glenn Chamandy, Gildan’s former CEO, has a strong track record of operating and managing the business. His leadership and vision have been instrumental in designing and building Gildan’s low-cost, vertically-integrated manufacturing operation, which has been the backbone of the company’s success.
We disagree with the Board’s decision to terminate Glenn Chamandy and strongly urge the Board to reverse this decision and re-appoint Glenn Chamandy as the CEO of Gildan.
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