UPDATE Monday, Jan. 22

On Sunday, Jan. 21^st Gildan’s Board of Directors continued the battle with Browning West by accusing the investment firm of violating U.S. anti-trust law in how it recently acquired more shares in the company. Directors asserted that Browning West illegally acquired the shares to gain the stake it would need to compel a shareholder vote aimed at replacing eight current directors with new board members and reinstalling former CEO Glenn Chamandy in the chief executive role. Browning West accused the board of “self-serving” legal tactics and criticized directors for what it called an “absurd level of expenditure” related to protecting its own reputation and to prevent Chamandy’s return.

ORIGINAL STORY

A new CEO/president started his tenure at Top 40 supplier Gildan (asi/56842) as the board of directors and former CEO exchanged new blows in their fight for control of the publicly-traded global apparel manufacturer.

Vince Tyra, a former Fruit of the Loom and Broder Bros. (now alphabroder, asi/34063) executive, began his CEO term on Monday, Jan. 15 – a month earlier than had previously been announced amid acrimonious fallout following the departure of former CEO/co-founder Glenn Chamandy.

The board dismissed Chamandy in December and immediately faced heat from the ousted executive and investors who back him. Led by Los Angeles-based firm Browning West, investors that hold roughly a third of Gildan’s outstanding shares are calling for Chamandy to be reinstated as CEO and as a board director. The activist investors also want to replace a majority of the Gildan board’s directors.

As of this writing, there had been no special meeting/vote among shareholders to consider the Browning West-led plans.

Board’s Latest Accusations Against Chamandy

Meanwhile, the board has pressed forward with installing Tyra and, during the week of Jan. 14, released a statement that accused Chamandy of lazy and shady business dealings, including having an alleged “undisclosed” tight relationship with an investor.

“Mr. Chamandy failed to disclose that he had invested in funds managed by a Gildan shareholder who has now come out in support of reinstalling Mr. Chamandy as CEO,” the board said. “A senior executive of that shareholder also purchased a multi-million-dollar property at Apes Hill, the private golf resort in Barbados owned by Mr. Chamandy.”

The latest in the corporate war over Gildan: The Top 40 #promoproducts firm's new CEO to start a month early -- on Monday.

As A Shareholder-vs.-Board Battle Rages, Vince Tyra To Take Over As Gildan CEO A Month Early https://t.co/QiQmYUQiLf

— Chris Ruvo (@ChrisR_ASI) January 12, 2024

The board also shared that Chamandy was invited as a guest speaker at Browning West’s February 2023 Investor Day, and maintained that the former CEO welcomed principals from the firm for an exclusive visit at Gildan’s manufacturing plant in Honduras – something the company said he did not do for other investors.

“It seems that Browning West was provided with a vastly different view of the potential future value of Gildan’s share price than what Mr. Chamandy told the board,” the directors said.

The board also reiterated claims that Chamandy had become a disengaged and ineffective leader, “holding few senior-management meetings and never bothering to visit the company’s newest manufacturing plant. Gildan has now learned that Mr. Chamandy sent on average no more than a handful of work emails a day and had few business-related meetings diarized on his calendar.”

Chamandy, Browning West Respond

Chamandy replied with a statement that panned the board for allegedly distorting the truth and trying to undermine his creditability to bulwark against the investor criticism.

Chamandy said the board’s accusations against him “reflect an approach that is misguided, misleading and value-destructive, prioritizing the obsession of board members with their own reputations above all else. It is imperative that the board refocus its efforts and priorities toward recovering the loss of value for which it is responsible – and listening to shareholders, a goal that benefits all stakeholders. This must be done forthwith to avoid further detriment to Gildan.”

“The board’s increasingly desperate messages in the face of unprecedented shareholder backlash are failing to divert attention away from substantive shareholder concerns.” Statement from Browning West

Fortune noted that Gildan’s market capitalization has declined by more than C$1 billion to C$7.2 billion ($5.3 billion) since Chamandy’s dismissal, as of this writing.

“The board’s increasingly desperate messages in the face of unprecedented shareholder backlash are failing to divert attention away from substantive shareholder concerns,” Browning West said in a statement to Fortune that was emailed by an outside spokesperson. “It has likely become clear to all shareholders that the board is much more focused on self-preservation than accepting shareholders’ views and creating value.”

Based on estimated 2022 North American promotional product revenue of $762.2 million, Gildan ranked fifth on Counselor’s most recent list of the largest suppliers in the industry.

Across all its business channels, including promo and others, Gildan tallied record total revenue of $3.24 billion in 2022. Through the first nine months of 2023, the company’s sales were down 4.3% compared to the prior year. Full-year results for 2023 are due out in the first quarter of 2024.