J. Crew Group has expanded its board from six to eight members to give the company additional outside expertise.
Currently, four members of the J. Crew board are insiders affiliated with owners TPG Capital and Leonard Green. But in a filing with the Securities and Exchange Commission, J. Crew said Chad A. Leat, a consultant with Apollo Global Management, and Richard D. Feintuch, former partner of the law firm Wachtell, Lipton, Rosen & Katz from 1984 until 2004, specializing in mergers, acquisitions, corporate finance and restructurings, had joined the board.
Also on the board are Millard “Mickey” Drexler, chairman and chief executive officer of J. Crew Group, and Stephen Squeri, who is with American Express.
The other four members are James Coulter and Carrie Wheeler, of TPG, and Jonathan Sokoloff and John Danhakl, of Leonard Green.
“The board has been heavily weighted toward internal directors,” said one debt source. “These two additions might help if the internal directors need to recuse themselves from a vote,” which could involve a number of scenarios, including potentially a sale of the intellectual property or other parts of the company which could benefit the owners, as well as restructuring debt, or choosing an eventual successor to Drexler. The company is believed to be seeking a successor who could partner with Drexler, working with him to learn the ropes, until eventually stepping up. Drexler has been working hard to turn around the J. Crew brand, while the Madewell division continues to perform well.
Leonard Green and TPG Capital bought the retailer for $3 billion in 2011. J. Crew’s debt includes $566 million in bonds coming due in May 2019 and a $1.5 billion term loan due in 2121.