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Browning West, long-term shareholder of Gildan, seeks a court order to prevent the Gildan board of directors from selling the company. The shareholder wants the Superior Court of Quebec to order that Gildan directors “not enter into any binding agreement related to the sale of Gildan” before the company’s annual meeting on May 28, according to multiple reports. The request was made as an amendment to an existing suit in the Quebec Superior Court’s commercial division, filed by Browning West.
The news is the most recent move in the battle that all began when CEO Glenn Chamandy was suddenly let go from the company at the end of 2023. The announcement sparked strong reactions from many shareholders, of which Browning West has been the most vocal about not supporting the decision.
As things continued to heat up, the Gildan board of directors announced they are entertaining potential sale offers for the apparel manufacturer. The board set an April 10 cut-off date for potential buyers to place their initial offers, according to Canadian news outlet The Globe and Mail.
A few days before filing for this most recent court order, Browning West proposed a five-pillar plan that would increase Gildan’s share price to more than $60 by the end of 2025 and more than $100 within the next five years, according to an article from Just Style. The investor outlined its proposed slate of director candidates to implement the plan, including Chamandy, who it feels should reclaim the role of CEO as he is alleged to have “delivered a nearly 100-fold total return for Gildan shareholders during his tenure.”
In this amended lawsuit, Browning West says that given the “unprecedented level of shareholder discontent” over the board’s leadership, investors had a reasonable expectation that the board would not undertake fundamental changes to the company until after they’ve had a chance to exercise their rights as stockholders at the annual meeting, as shared by The Globe and Mail. The firm asks the court to order the Gildan board not to enter into a binding sales agreement until that meeting takes place.
“This latest tactic is ridiculous and without precedent or merit,” Gildan spokesman Simon Beauchemin wrote in an e-mail response to The Globe and Mail. “It appears designed solely as an attempt to generate headlines and obstruct a potential sale of the company.”
