Longstanding Gildan investor Browning West has asked Gildan’s board to answer questions regarding its “apparent diligence failures” during the process that led to the appointment of its new CEO Vincent Tyra.
Gildan officially named Tyra as is new CEO last month, insisting that he was the right man for the job, despite ongoing protests from several major shareholders.
Tyra has previously served as president at apparel brand Fruit of the Loom and CEO at apparel wholesaler Broder Bros.
Browning West has now raised fresh concerns about Tyra’s suitability for the role, accusing him of having “a clear track record of value destruction” in previous roles. The investor also questioned Gildan’s research into his prior experience.
The investor claimed Fruit of the Loom’s share price decreased by 99% during Tyra’s tenure and Broder Bros’ net income decreased from $7m to -$3m during his time as CEO.
“We suspect many other Gildan shareholders share our concerns,” Browning West said in a statement.
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Browning West said it met with Tyra, alongside the chair of Gildan’s corporate government and social responsibility committee Maryse Bertrand, to better understand his appointment.
“We ultimately left the meeting with more questions than answers due to Tyra’s and Bertrand’s inability to address our concerns pertaining to poor financial results at Fruit of the Loom Inc and Broder Brothers Co,” Browning West said in a statement.
Browning West added: “If the board decided to proceed with hiring Tyra after learning about his record of value destruction, we believe it reveals extremely poor judgement and numerous governance issues.
“On the other hand, if the board made its decision without investigating Tyra’s history of value destruction, we contend it indicates that the company’s CEO search process had significant diligence failures. Either way, it appears the incumbent directors failed shareholders when appointing Tyra.”
The investor explained it has written to the chair of Gildan’s compensation and human resources committee Shirley Cunningham, requesting a call to better understand the due diligence on Tyra’s record, but has yet to hear back.
Gildan had not responded to Just Style’s request for comment at the time of going to press.
The news comes shortly after Gildan’s board claimed its former CEO had a “close relationship” with Browning West and did not prioritise his work.