With the new CEO of Gildan Activewear, Inc., Vince Tyra, at the helm early, in defiance of a large group of investors and shareholders, the company has turned to justify the Board of Directors hire when it ousted Glenn Chamandy, Gildan’s former CEO. The Board’s strategy includes releasing additional information about Chamandy’s conduct around the time of his removal as CEO on December 10, 2023.
The Board said in a release that the information sheds new light on at least one undisclosed relationship between Chamandy and a shareholder now calling for his reinstatement, and the company is looking into others.
“The Board has stated that it gradually lost trust and confidence in Mr. Chamandy,” the company said in a statement released on January 16, 2024. “This new information, much of it obtained by accessing Mr. Chamandy’s files and electronic information following his departure, underscores that view. Mr. Chamandy’s actions and lack of transparency with the Board are further indication that new leadership was required at Gildan.”
In its January 8, 2024 letter, the Board explained how it felt Chamandy, CEO for 20 years, became more disengaged as he was increasingly distracted by outside personal pursuits, including developing a luxury golf resort in Barbados.
As part of its take-down of Chamandy, Gildan released new information to its shareholders, including the following list of issues, with some appearing to be perceptions of his work ethic before his termination. However, others resulted from an investigation after Chamandy was fired, and the investor push-back ensued.
The Board’s published findings are noted below.
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In addition to rarely being in the office, holding few senior management meetings and never bothering to visit the Company’s newest manufacturing plant, 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 diarized on his calendar.
Mr. Chamandy failed to disclose that he had invested in funds managed by a Gildan shareholder who has now come out in support of reinstalling Mr. Chamandy as CEO. A senior executive of that shareholder also purchased a multi-million-dollar property at Apes Hill, the private golf resort in Barbados owned by Mr. Chamandy.
Mr. Chamandy also seems to have a close relationship with Browning West, the activist hedge fund now leading the aggressive and misleading campaign to reinstall him as CEO. He was invited to be one of the guest speakers at the hedge fund’s February 2023 Investor Day, and while Browning West has been invested in Gildan for years, Mr. Chamandy appears to have treated Browning West differently than other Gildan shareholders.
For example, on November 8, 2023, just a week after Mr. Chamandy proposed his high-risk acquisition plan to the Board and was pressing them to retain him as CEO, he welcomed Usman Nabi and Peter Lee, the co-founders of Browning West, and a number of Browning West investors, on an exclusive visit to the Gildan manufacturing plant in Honduras.
The company has no record in recent history of any other Gildan shareholder and their own investors being hosted by the CEO to an exclusive visit to a Gildan facility. And, as the Board pointed out in its January 8, 2024 letter, it seems that Browning West was provided with a vastly different view of the potential future value of Gildan’s share price than what Mr. Chamandy told the Board.
On Saturday, November 25, 2023, Mr. Chamandy sent the Board a letter with an ultimatum to approve his risky multi-billion-dollar acquisition strategy and his succession plan. The next day, on Sunday, November 26th, before the Board had even responded, Mr. Chamandy began moving out of his office.
Finally, in its ongoing campaign of misinformation, Browning West has claimed that Gildan plans to hold its Annual General Meeting of Shareholders “…as late as Fall 2024.” That is false. The Company will respond to the requisition in due course.
Editor’s Note: Perhaps if Gildan’s Board of Directors keeps digging they could discover the real reason they ousted CEO Glenn Chamandy. Sounds like a new season of Succession.
Image courtesy of Gildan
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For more SGB Media coverage on Gildan, see coverage below.
Gildan Activewear Board Makes Extraordinary Next Move in Investor Fight
Gildan Board Saga Continues as Shareholders Look to Take Action
Gildan Board Responds to CEO Ouster Backlash Coming from One-Third of Shareholders
Gildan Investor Wildfire Spreads as More Firms Join the Call to Reinstate CEO
