Tags: Lululemon | founder | stake | clash

Lululemon Founder Sells Half His Stake, Ending Clash

Thursday, 07 Aug 2014 06:33 PM

Lululemon Athletica Inc. founder Chip Wilson agreed to sell half his stake to Advent International for $845 million and not to pursue a buyout until 2016, ending a clash with the board.

Wilson, who had voiced his dissatisfaction with the company’s current direction after stepping down as chairman, also agreed with Advent to name David Mussafer and Steve Collins to the board, according to a statement Thursday. The stake sold represents about 13.9 percent of the shares outstanding.

The deal caps months of disagreements between Lululemon and its outspoken founder, who said in June he voted unsuccessfully against the re-election of Michael Casey, his successor. It will enable management to focus on reigniting sales growth and on its plan to expand overseas. The Vancouver-based company has been trying to regain customers after recalling a popular line of black Luon yoga pants last year for being see-through.

Advent was an early backer of Lululemon and helped it expand from a regionally focused retailer to a global brand. Back in 2005, Wilson sold a 48 percent stake in his company to Advent and Highland Capital Partners for $93 million. Advent, which exited its original investment in June 2009, said in the statement that it worked closely with Wilson and five of the current directors, including Casey, during its expansion.

Wilson, a 59-year-old billionaire and meditation activist, drew controversy last year when he said Lululemon’s pants “don’t work for some women’s bodies.” He apologized a week later for the remarks, which he made on Bloomberg Television.

Mussafer will become co-chairman with Casey. The two new directors will join the board at the closing of the transaction, expanding it to 12 members from 10.

The shares jumped 7.6 percent to $42 after the markets closed in New York.

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Lululemon Athletica Inc. founder Chip Wilson agreed to sell half his stake to Advent International for $845 million and not to pursue a buyout until 2016, ending a clash with the board.
Lululemon, founder, stake, clash
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2014-33-07
Thursday, 07 Aug 2014 06:33 PM
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