National Post (National Edition)
Lululemon strips founder of key board right
Wilson not able to designate board nominee
Chip Wilson’s feud with Lululemon Athletica Inc. is alive and kicking.
The billionaire’s right to designate a board nominee was terminated after he “failed to observe the requirements of the support agreement relating to certain contesting stockholder actions,” the company, best known for its yoga pants and workout gear, said in a recent filing that didn’t specify what prompted the change.
Wilson returned to the spotlight last year with a book — Little Black Stretchy Pants — that bemoaned Lululemon’s performance since 2013, arguing the firm failed to take advantage of its leadership position and lost ground to rivals including Under Armour Inc. and Nike Inc.
He was also an investor in a consortium that reached a US$5.2 billion deal in December to buy Amer Sports Oyj, the maker of Wilson tennis rackets and Louisville Slugger baseball bats.
Shares of Lululemon rose to a record last week and have surged 77 per cent in the past year. They were up about one per cent on Wednesday in mid-afternoon New York trading to US$175.72.
Wilson, meanwhile, has sold into the rally, disposing of about US$725 million of the company’s shares in 2019, according to calculations by Bloomberg.
Lululemon and Wilson declined to comment through spokespeople.
Wilson “informed the board that he did not agree with the board’s conclusions,” according to the April 24 filing.
Wilson’s relationship with the Vancouver-based athleticwear maker he founded in 1998 has long been fraught. After a November 2013 interview with Bloomberg, in which he said Lululemon’s pants “don’t work for some women’s bodies,” Wilson apologized, stepped down as chairman a month later, then threatened a boardroom fight. He sold half his stake in 2014 before resigning in 2015.
In a more recent interview with Bloomberg last October, he said he wanted to return to a public board in 2019 and that Lululemon was his first choice.
This may not be the end of the feud. Despite Wilson’s recent share sales, he still owns 9.4 per cent of the company, which comprises more than half of his US$3.9 billion fortune, according to the Bloomberg Billionaires Index.