The pressure is building on lululemon athletica’s (LULU) board to make major changes to the athleisure company with its founder now joining the campaign.
Dennis “Chip” Wilson, who founded lululemon (LULU) in 1998 and left the company in 2015 and remains the company’s second largest shareholder, has launched a proxy fight with the nomination of three director candidates including former On Running (ONON) co-CEO Marc Maurer, former ESPN (DIS) Chief Marketing Officer Laura Gentile, and former Activision (MSFT) CEO Eric Hirshberg, according to sources cited by The Wall Street Journal.
Wilson joins Elliott Investment Management in pushing for leadership changes at the struggling company as it begins the search for a new chief executive to replace Calvin McDonald. Elliott’s top choice will likely be Jane Nielsen who is currently acting as advisor to the firm.
While Wilson is not nominating himself for the board, his outspoken views as to how the company is being run has been widely publicized. In October, Wilson ran a full-page Wall Street Journal ad blaming lululemon’s leadership for a 54% drop in its stock and signaling a potential proxy battle or alliance with another major investor.
“Lululemon directors have systematically dismantled the business model and lost employees who help the institutional knowledge that made the company great….like a plane crash, declines rarely happen because of a single failure, it’s a series of mistakes,” Wilson said in October in The Wall Street Journal ad.
Faced with escalating competition and loss of confidence among investors, lululemon (LULU) is “running out of time,” Wilson warned.
Lululemon (LULU) shares are fractionally lower into Monday’s open.