Solomon Lew is upset and seems to have decided to have ‘a go’ at Myer, its board especially and senior management and says he will use the 10.8% of the retailer owned by his company, Premier Investments to vote against resolutions at next month’s annual meeting.
It was made clear yesterday in filings with the ASX (https://www.premierinvestments.com.au/wp-content/uploads/2017/10/2017.10.24-PMV-re-Myer-AGM.pdf) and a separate letter to shareholders that he is upset at being rebuffed and will ‘take on’ the board at the meeting and try and defeat the re-election of certain directors and other motions.
He says the retailer has rebuffed his request for two seats on department store chain’s board, and is now encouraging fellow shareholders to vote against the appointment of its chairman elect, Garry Hounsell.
In a letter to the ASX on Tuesday morning, Mr Lew’s Premier Investments said it had no “current" intention of making a takeover bid for Myer. The veiled threat left Myer shares all but unmoved. They were up 0.6% at a still depressed 75 cents (Mr Lew paid $11.14 each for his stake). Premier shares rose 1% to $13.26
Mr Lew said in a letter to Myer shareholders that “enough is enough” and that Premier would be voicing its concerns at the company’s AGM on November 24.
"Our greatest criticism of Myer is the lack of mass-merchandise retail experience on the board," he said. "How can the directors possibly advise management and keep them on their toes?"
"As Myer shareholders we deserve better. Myer customers deserve better. The Australian fashion industry deserves better – it needs Myer to be a strong competitor to the global brands that are increasingly coming to our shores."
Mr Lew said yesterday met with Garry Hounsell, Myer’s chairman elect on Friday, October 6, to ask for two board seats, the letter says, but that request was refused.
"Mr Hounsell then inferred to the media that he was yet to meet with Mr Lew, and publicly backed the ‘New Myer’ strategy against all of the evidence that it is not working," the statement says.
Myer then appointed Julie Ann Morrison to the board six days later. In pointed wording, Premier’s described Ms Morrison as a former company director of Myer’s "failed" Sass & Bide business.
The letter confirms that Premier will vote against all Myer’s appointments at its annual general meeting next month, including Mr Hounsell and Ms Morrison, and urged other shareholders to do the same.
“Myer is an iconic and important Australian business which, for the sake of its shareholders, employees and customers, must not be allowed to suffer any further decline,” the statement said.
"Premier wishes to contribute its significant retail industry expertise at board level, and hopes that it can garner the support of its fellow Myer shareholders to do so."
Premier said it reserved the right to call an extraordinary general meeting in the short term so shareholders could vote on its nominees.
In a separate letter to Myer shareholders he encouraged them to vote against the company’s board appointments, saying he had always admired Myer, which at its height was "a well-run business that understood what its customers wanted to buy, and delivered it with great service".
"Sadly, those times are long gone," Mr Lew said. “It has too much product that people simply don’t want to buy. Its stores – particularly those in suburban and regional areas – are disorderly, and it has not invested in frontline customer service.”
"Our greatest criticism of Myer is the lack of mass-merchandise retail experience on the Board. How can the directors possibly advise management and keep them on their toes?
"How can they add any value to discussions about strategy, pricing, ranging, distribution, property, store locations, customer service, supplier relationships and all of the other critical elements of successful retailers?” Mr Lew asked.
