Perry Ellis International Inc. has responded to the proxy fight begun on Friday by two activist investors, as well as their push for two shareholder proposals.
Legion Partners Holdings LLC and the California State Teacher’s Retirement System on Friday began a proxy fight by proposing that shareholders elect its slate of board nominees: Robert Mettler, Darrell Ross and Joshua Schechter. As for the two shareholder proposals, the activists are seeking separation of the roles of chairman and chief executive officer, both of which are held by George Feldenkreis, and the declassification of the board into a single class.
The apparel firm said its board “regularly evaluates strategies to enhance value for all Perry Ellis shareholders, and over the past two years, the board and management team have identified and begun executing on a series of strategic initiatives.” Those initiatives are aimed at driving global growth, reducing costs and inventory and increasing gross margins and operating margins, the company noted.
Perry Ellis also said its board is committed to enhancing corporate governance practices, noting steps such as majority voting and a resignation policy for directors and enhancing stock ownership requirements under its stock ownership guidelines for directors and executive officers.
It also emphasized that the company’s board and management own “more than 25 percent of the outstanding shares of the company and accordingly, their interests are firmly aligned with those of shareholders.”
The company said “Legion has failed to provide us with any credible plan or actionable ideas for driving success at Perry Ellis,” noting as well that months ago the company indicated to the activist that it would “consider individuals who may further enhance the depth and breadth” of the current board. Legion declined to provide us with any suggested candidates, the company said.
Perry Ellis said its board is recommending that shareholders elect its slate of nominees that will be listed in the company’s filing of its definitive proxy statement with the Securities and Exchange Commission in June.
The apparel firm’s annual meeting of shareholders is scheduled for July 17 at a time and location still to be determined.