Now Reading: Ethan Allen CEO defends leadership after activist proxy challenge
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Ethan Allen CEO defends leadership after activist proxy challenge
Ethan Allen CEO defends leadership after activist proxy challenge
Ethan Allen CEO Farooq Kathwari, 80, has publicly defended his leadership for the first time after activist investor Douglas Bergeron launched a proxy fight to replace the entire board. In a Bloomberg…
The Story in Brief
Ethan Allen CEO Farooq Kathwari, 80, has publicly defended his leadership for the first time after activist investor Douglas Bergeron launched a proxy fight to replace the entire board. In a Bloomberg TV interview, Kathwari argued the company's focus on in-store interior design services over digital sales is the right long-term strategy, even though online sales are growing industry-wide. He acknowledged website sales are lower but said customers who meet designers in-store spend three to five times more. Bergeron, who holds a 5% stake, wants Kathwari and the board replaced, citing outdated strategy and over-tenured management. The company reported a 5.7% drop in net sales for the fiscal year ending June 30.
The Indian Opinion
The activist's claim that the 80-year-old CEO is too old sounds like ageism dressed as strategy. But Ethan Allen's 5.7% sales decline is real, and the CEO's dismissal of digital growth as short-term thinking ignores a clear market trend. The real test is whether the board backs Kathwari's in-store focus or Bergeron's digital push. If the proxy fight fails, can the company prove its model still works? Watch next quarter's same-store sales.
Source: livemint.com
This story was synthesised by AI from the source linked above.
