The Clinton Group Inc. said it will solicit fellow stockholders for written consent to have four members of The Wet Seal Inc. board removed and replaced with new directors. The activist investor group, which owns more than 5 percent of the outstanding stock of the retailer, wants to fill the board seats, plus the one existing vacancy, with independent directors.
Joseph DePerio, senior portfolio manager for Clinton Group, said, “After years of strategy shifts, personnel changes and financial and operational mismanagement, it is time for shareholders to put in place a board that will work feverishly to fix the damage, repair the brand and earnestly consider the company’s strategic alternatives. More of the same is simply not an option.”
The five individuals Clinton is seeking to place on the specialty chain’s board are: Raphael Benaroya, who founded United Retail Group Inc.; Dorrit M. Bern, former chairman, chief executive officer and president of Charming Shoppes Inc.; Lynda J. Davey, chairman and ceo of investment banking firm Avalon Group Ltd.; Mindy C. Meads, former president and co-ceo of Aéropostale Inc., and John S. Mills, a retail consultant.
The teen specialty chain on Tuesday posted a second-quarter loss of $12.4 million, or 14 cents a share, against year-ago earnings of $2.2 million, or 2 cents a share. Sales fell 9.1 percent to $135.3 million on a comparable-store sales decline of 11.1 percent.