David­stea co-founder wrests con­trol of re­tailer

Saskatoon StarPhoenix - - FP SASKATOON - ROSS MAROWITS

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.

Joel Sil­ver

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