Update: Marcato Responds to Preliminary Vote
In response to a vote by Deckers Brands’ stockholders to re-elect the company’s existing board of directors, Mick McGuire, managing partner of Marcato Capital Management, said following in an email statement to Footwear News today: “We continue to believe that the status quo at Deckers is unacceptable, and the board must take meaningful steps to avoid repeating its many historical failures. We are pleased to have served as a positive change agent and believe our involvement has created significant value for all stockholders. However, a lot of work is still required in order for Deckers to reach its full potential.”
Deckers Brands’ board of directors remains intact.
After a 10-month battle with activist shareholder Marcato Capital Management — which beneficially owns an 8.5 percent stake in the firm — Deckers’ stockholders have voted to re-elect all of its directors at the company’s annual shareholder meeting today. (Deckers’ board comprises John Gibbons, Karyn Barsa, Nelson Chan, Michael Devine III, John Perenchio, David Powers, James Quinn, Lauri Shanahan and Bonita Stewart.)
“We are very pleased with the outcome of today’s vote. On behalf of the entire Deckers Board and management team, we sincerely thank our stockholders for their valuable insight and support throughout this process,” the company said in a statement. “Today’s outcome reaffirms that we are on the right track. We remain focused on continuing our strategic transformation as we optimize our retail strategy, improve operating profits, refresh our board and return capital to stockholders.
After disclosing a 6 percent stake in Deckers in February, Marcato Capital has been highly critical of the company’s management and existing board — particularly its handling of hero brand Ugg — and has been determined to force change at the firm. Among its demands, Marcato had been pressuring Deckers to pursue a sale of the company. Marcato had further threatened to nominate a slate of new directors to replace Decker’s entire existing board if the company’s strategic review process — initiated in April — did not result in a sale. (Deckers said in October that it had concluded the strategic review and decided not to pursue a sale.)
Marcato made good on that promise in September, nominating 10 new members, including L.L. Bean SVP and chief marketing officer Steve Fuller, David’s Bridal president and CEO Robert Huth, Ralph Lauren head of global human resources Mitchell Kosh and former Michael Kors executive Anne Waterman. Deckers did not approve those nominations — prompting Marcato to file suit against the company in October.
Deckers expects to file today’s preliminary voting results on a Form 8-K with the U.S. Securities and Exchange Commission within four business days. Deckers said it will file the final voting results as soon as practicable.