Activist investors are again challenging the Dillard’s family — this time trying to get Dillard’s Inc.’s top executives to effectively relinquish their control over the board by selling their Class B stocks back to the firm.
Clinton Group Inc. and Barington Capital Group, which are among a cohort of investors that holds 5.7 percent of the retailer’s Class A common stock, has sent a letter to the board arguing that public shareholders are penalized by the company’s two-tier share system. The correspondence was filed with the Securities and Exchange Commission.
“Currently, a number of the senior executives of Dillard’s control the company’s Class B common stock through their ownership interests in W.D. Company, which itself owns approximately 99.4 percent of the Class B shares,” the letter said. “While the Class B shares have the same per share economic interest in the company as the Class A shares, such shares provide the Class B shareholders with effective control over the company through their ability to elect two-thirds of the members of Dillard’s board of directors.”
The investors noted that there are 4 million Class B shares outstanding and said the holders of the 70 million Class A shares could buy out the other class at a “substantial premium.”
Clinton Group and Barington Capital endorsed having outside directors in control of corporate boards. “We also believe that the public equity markets in general justifiably reward companies where management teams do not have effective control,” the letter said. “In the case of Dillard’s, however, it is clear to us that the company and its public shareholders are being penalized because of its A/B share class structure.”
The activists had pressured Dillard’s to improve profitability.
The retailer finally relented to appointing outsiders after the activists pushed for disclosure of executive compensation and perks, such as use of the company aircraft and threatened a proxy fight. In June, a slate of four new directors was named, including R. Brad Martin, former chairman and chief executive officer of Saks Inc., and Nick White, president and ceo of White & Associates and former general manager of Wal-Mart Stores Inc.’s Supercenter division.
Shares of Dillard’s closed Friday at $12.84, up 34 cents, or 2.7 percent.
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast