David­sTea co-founder’s proxy bat­tle goes cy­ber with new web­site launch

Windsor Star - - FINANCIAL POST -

A new front has opened up in the proxy bat­tle for David­sTea af­ter the com­pany’s founder launched a web­site as part of his ef­fort to gain con­trol of the em­bat­tled bev­er­age re­tailer. Rainy Day In­vest­ments Ltd., the hold­ing com­pany of co-founder Her­schel Se­gal, launched a web­site site called savedtea.com to sum­ma­rize its turn­around plan. The firm had pre­vi­ously eyed tak­ing David­sTea pri­vate, but said in March it won’t pro­ceed with that and had no plans to sell its shares. The in­vest­ment firm, which owns about 46 per cent of the Mon­treal-based com­pany’s out­stand­ing shares, has proposed a slate of seven nom­i­nees to the board. The bat­tle will be de­cided at David­sTea’s an­nual meet­ing June 14. A spokes­woman for David­sTea said Thurs­day it is re­view­ing the web­site to en­sure it doesn’t vi­o­late copyright or mis­ap­pro­pri­ate David­sTea’s brand iden­tity.” “The dis­si­dent’s ac­tions un­der- score our con­cern that Mr. Se­gal be­lieves he con­trols this com­pany and in­tends to take con­trol of the board with­out pay­ing share­hold­ers a pre­mium for that,” she said in a state­ment.

Se­gal said in a news re­lease that the cur­rent board, from which he re­signed in March, is wast­ing time, re­sources and share­holder money ex­plor­ing strategic al­ter­na­tives to sell all or part of the com­pany. “Ur­gent ac­tion is needed now to put David­sTea back on the path to growth and long-term suc­cess for the ben­e­fit of all share­hold­ers,” he said.

David­sTea has been pub­licly traded since June 2015 when it listed on the Nasdaq stock mar­ket as part of an ex­pan­sion plan. The com­pany an­nounced in 2017 that it was con­sid­er­ing strategic al­ter­na­tives such as a po­ten­tial fi­nanc­ing, re­fi­nanc­ing or re­struc­tur­ing af­ter post­ing poor re­sults, es­pe­cially in the United States.

THE CANA­DIAN PRESS/AP, Mark Len­ni­han

David­sTea co-founders David (left) and Her­schel Se­gal (cen­tre) cel­e­brate the com­pany’s IPO in 2015.

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