Lululemon Athletica (LULU) is striking back at founder Chip Wilson, who has been a vocal critic of the Canadian company in recent years.
The Vancouver-based athletic wear maker is taking its battle with Wilson public, writing in a letter to shareholders that he has “outdated perspectives” and “troubling conflicts of interest.”
The board of directors at Lululemon added that Wilson’s ideas to improve the company will derail its own turnaround plans.
The shareholder letter is Lululemon’s first public response to Wilson since he launched a proxy battle against the company late last year.
Settlement talks between Wilson and Lululemon apparently fell apart last week.
In recent months, Wilson has publicly criticized Lululemon’s board of directors, as well as new CEO Heidi O’Neill. He has gone so far as to take out advertisements criticizing the company.
Now, Lululemon’s board is fighting back, urging shareholders to approve O’Neill as the new CEO, as well as new board nominees at the upcoming annual meeting set for June 25.
Lululemon’s business has struggled over the past two years with declining sales, product misfires, and tariffs. The company also faces growing competition in the athleisure space.
Wilson founded Lululemon in 1998 and stepped down as CEO in 2005 but stayed on as chairman of the board until 2013.
The departure of Wilson, who remains Lululemon’s largest individual shareholder, came after he blamed a recall of the company’s pants on customers. “Some women’s bodies don’t work for the pants,” he said.
LULU stock has declined 63% in the last 12 months to trade at $119.14 U.S. per share.
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