Engaged Capital is showing some muscle, pushing for more independence in the makeup of Abercrombie & Fitch Co.’s board.
The hedge fund, which owns nearly 0.6 percent of the outstanding shares of Abercrombie, on Thursday disclosed its five nominees for election to the Abercrombie board at this year’s annual meeting. The five are Alexander P. Brick, former chief executive officer of Specialty Retail Group; Robert D. Huth, former ceo of David’s Bridal; Michael W. Kramer, former chief operating officer of J.C. Penney Co. Inc. and former ceo of Kellwood Co., as well as a former executive at Abercrombie; Diane L. Neal, former ceo of Bath & Body Works and the former president at Mervyn Stores when owned by Target Corp., and Glenn W. Welling, chief investment officer and managing member of Engaged Capital.
Welling said the company needs a board of independent leaders who can “set a new direction for Abercrombie.” He added: “For far too long, stockholders have suffered under the failed leadership of a board that has lacked the independence necessary to properly act as our fiduciaries.”
Last month the teen retailer split the positions of chairman and chief executive officer and named Arthur Martinez, 74, non-executive chairman. Michael Jeffries, 69, who had been chairman for 18 years, remains chief executive officer and a director.
Abercrombie also moved to bolster its retail talent on its board, increasing the number of board members to 12 with the appointments of Martinez; Terry Burman, chairman of Zale Corp., and Charles R. Perrin, former chairman and ceo of Avon Products Inc. The three are considered independent directors.
Abercrombie’s Martinez said, “As we have communicated during numerous discussions with Engaged Capital, I am committed, and the entire [Abercrombie] board is committed, to continue taking significant steps to strengthen and enhance corporate governance as the company moves into the next phase of growth.”
Sources said all incumbent directors are expected to run for reelection. Given the length of tenure for nine incumbents, these sources said should all five of Engaged Capital’s nominees get elected, along with the three newly appointed directors earlier this month, Abercrombie’s board would be controlled by a majority of independent directors for the first time in years.
One source familiar with Engaged’s position said the hedge fund is looking for new leadership that can effect a viable strategy to turn around the company, particularly the positioning of its core Abercrombie and Hollister brands to the female consumer. This individual also said that “Engaged has never said it was pushing for a sale” of the company, and that it wants a “new team that would be open to evaluating all options to creating value” for shareholders.
Michael Appel, president of restructuring consultancy firm Appel Associates, said, “The issue at Abercrombie is whether you really have an independent board, given the current composition. They just gave Jeffries a new contract. How independent are they? Take a look at how long it took them to separate the chairmanship from the ceo position. So the question is, did the board do enough with that change, or did they do this as a defensive measure to entrench themselves?”
There'll be no rest for those headed to Europe for men's, as Paris just closed the gap with Milan. According to a provisional calendar released by the Chambre Syndicale, Paris Men's Week will now open a day earlier on January 16. See new highlights on the official lineup on WWD.com. #wwdnews #wwdfashion (📷: @kukukuba)
BREAKING: Jonathan Saunders is leaving @DVF. The designer has resigned from his position as chief creative officer of Diane von Furstenberg, the company said in a statement on Friday. At the time of his hire, von Furstenberg said Saunders’ arrival symbolized and facilitated her stepping back from the day-to-day duties that occupy the work of a full-time creative director. The British designer joined DVF in May 2016 and was in charge of all product categories. #wwdnews
For @versace_official’s spring ad campaign, the brand emphasized the archival prints from the spring tribute collection dedicated to the late Gianni Versace. Closing out the show were five of Gianni’s favorite models: Cindy, Naomi, Carla, Helena, and Claudia. Bowing on December 18, the new campaign is yet another tribute to supermodel-dom as the images by Steven Meisel are fronted by @iamnaomicampbell, @cturlington, @gisele and more. #wwdfashion
Four-time Oscar-nominated actress Annette Bening has been waiting 20 years to play Gloria Graham in "Film Stars Don't Die in Liverpool," which will be released on December 29. The movie about Graham – a Hollywood star known for her controversial relationship with a younger Englishman named Peter Turner – is based off a memoir Turned wrote. "She felt vulnerable to him, because she loved him, she really did love him. And anyone that we really truly are in love with, we re vulnerable to in a very deep way," said Bening. Read our full interview with the modern icon of an actress on WWD.com. #wwdeye (📷: @ninebagatelles; Styled by @cristinaehrlich)
The crisp white button down: a staple that can be dressed up or down and accessorized throughout the decades. Here, on a Art Basel-goer in 2017 on the left and on the iconic Audrey Hepburn in “Roman Holiday” in 1953 on the right. #tbt #wwdfashion (📷: Andrew Morales)
Known for her work with @victoriassecret, 25-year-old model @georgiafowler is raising her profile in Hollywood. Fowler stars in @vincecamuto’s holiday campaign, which launched in partnership with “Pitch Perfect 3.” “Almost every shoot with Vince Camuto, I’ve had to face a fear…It was definitely a challenge. I’m so grateful for it, though. I’ve always wanted to be a pop star, so that was the perfect chance,” Fowler said. Head to WWD.com to read about Fowler’s experience modeling, including at the #VSFashionShow, and her relationship with Nick Jonas. #wwdeye (📷: @jilliansollazzo)
EXCLUSIVE: Huda Kattan just became the first beauty influencer to land a major beauty deal. Kattan's business, @hudabeauty, has received a minority investment from private equity firm TSG Consumer Partners. The brand, which industry sources say is on track to do $200 million in retail sales for 2017, will receive support on product, retail and geographic expansion through the deal. Get all the details on the deal and read @_a_collins' interview with Kattan on WWD.com. Link in bio. (📷: @jgreenery) #wwdbeauty #wwdnews
Peruvian model @juanaburga_official – who is known for walking the runways of @rodarte, @viviennewestwood and @torybuch – is making the move to the big screen with drama “Los Últimos.” The film premiered in Argentina in November and arrives in the U.S. and Europe in 2018. On making the switch from modeling to acting, Burga told WWD: “It’s a completely different thing – a lot of people think it’s similar or try to connect things, especially like getting used to the camera or being looked at all the time or playing these different characrers, but film is a completely different story.” #wwdeye (📷: @jgreenery)
London’s newly opened @designmuseum will look back on the life and work of Azzedine Alaïa in a show that the designer helped to curate before he died of heart failure last month. The retrospective, which Alaïa had worked on with Mark Wilson, chief curator of the @groningermuseum, will look at the impact of his work worldwide. The show, “Azzedine Alaïa: The Couturier,” will run from May 10 to October 7. Read more about the exhibit on WWD.com #wwdnews #wwdfashion (📷: @zefashioninsider)