Davidstea co-founder wrests control of retailer
MONTREAL DavidsTea’s CEO resigned Thursday after losing a battle with the company ’s co-founder that saw the entire board replaced over the direction of the struggling specialty-beverage retailer.
Chief executive Joel Silver, who led an attempt to prevent a shareholder revolt led by Herschel Segal, quit after the vote results were announced at the company’s annual meeting.
Segal took over as executive chairman and interim CEO and the company said it will begin a search for a permanent chief executive to replace Silver, who was in the position for little more than a year.
Fifty-four per cent of the votes cast at the shareholder meeting backed Segal’s slate of seven directors over the management nominees.
Segal pledged Thursday that the chain of 240 stores in Canada and the U.S. will become profitable within a year and focus on its Canadian roots.
Segal, a veteran retailer who also founded clothing chain Le Chateau, said Davidstea has a great brand and product that has failed to find its footing in the United States. “After six years of working in it, not only did we not make it in the States because there’s a different culture and a different customer there and what we did was at the same time neglect Canada.”
Some U.S. stores might be closed but first Davidstea’s brand mission has to be clarified and made efficient to restore profitability, Segal said in a brief news conference.
Also elected to the board were corporate director William Cleman, Viau Foods president Pat De Marco, retired professor Ludwig Max Fisher, former MEC chief executive Peter Robinson and Roland Walton, former president of Tim Hortons Canada and Le Chateau president Emilia Di Raddo.
The Montreal-based company lost $30 million last year on $224 million of sales.