Shareholders of Canadian retailer Lululemon Athletica (LULU) have voted to approve the company’s slate of board members in what proved to be a controversial vote.
Shareholders ended up electing three new board members. They include former Levi Strauss (LEVI) CEO Chip Bergh, who was supported by Lululemon’s current management team.
At the company’s annual meeting, shareholders also approved Marc Maurer and Laura Gentile, two new board members who had been put forward by Lululemon’s founder Chip Wilson.
Gentile is an ex-ESPN chief marketing officer and Maurer is the former co-CEO of running shoemaker On Holding (ONON).
The appointments take Lululemon’s board of directors to strength at 11 members and will allow incoming CEO Heidi O'Neill to focus on reviving Lululemon’s brand and sales.
However, the board vote proved controversial after Lululemon took the unusual step of barring non-shareholders and the media from attending its annual meeting.
Lululemon also said that anyone who wanted to attend this year’s shareholder meeting had to hold LULU stock on April 30 this year, which was before Lululemon reached a truce with Wilson.
Wilson had publicly criticized Lululemon’s management team for years and had been pushing to add Marc Maurer and Laura Gentile to the company’s board of directors over the past year.
Lululemon eventually agreed to put Maurer and Gentile up for a shareholder vote as part of an agreement the company reached with Wilson to end his proxy battle against the company.
However, Lululemon than sought to limit coverage and potentially participation in the shareholder vote at the company’s annual meeting.
Some analysts said the board vote was a test of how shareholders felt about the deal the company reached with Wilson to end his public criticisms of management.
Lululemon has struggled with declining sales and market share in recent years that has been driven by rising competition and product misfires.
LULU stock has declined 52% in the past 12 months to trade at $112.06 U.S. per share.
