Will Lululemon's New CEO Embrace Downward Dog?
NEW YORK ( TheStreet) - Lululemon Athletica's
Six months after Lululemon's CEO Christine Day announced her intention to resign, the yoga and apparel maker said Laurent Potdevin, who's had brand and management experience at Louis Vuitton , Burton Snowboards and most recently as the president of TOMS Shoes , the socially responsible company known for matching every pair of shoes purchased with a pair of shoes given to a child in need, would replace her.
The Vancouver-based company also said Chip Wilson, its founder and chairman would resign from the position prior to Lululemon's annual meeting next June. Michael Casey, Lululemon's lead director and a former Starbucks'
|Lululemon hired Laurent Potdevin, the former president of TOMS Shoes, as its new CEO.|
Potdevin will step into his role in January; Day will stay on until the end of the company's fiscal year to help with the transition.
Shares were down 0.51% to $69.98 in mid-Tuesday tade.
The management shift -- Potdevin's brand and operational knowledge combined Casey's experience -- may just be the thing that the specialty yoga retailer needs to get it back to being the Wall Street darling it once was.
The stock is down roughly 8% this year, compared to Under Armour's
"It's a good fill because clearly [Potdevin] is coming from a very creative, ambitious place prior and that's what this company has been until now and probably just needs a shot of creativity in the arm", said David Tawil, co-founder and portfolio manager at Maglan Capital , a hedge fund that focuses on distressed companies. Maglan does not own any positions in Lululemon.
"I don't think they're looking to become a mundane, mass-merchandiser," Tawil said. "They don't need someone to sell down; they need someone to continue to push the envelope up."
Lululemon has been barraged with bad publicity after it was forced to recall its popular luon pant over sheerness complaints this past spring. More recently, customers have been complaining about pilling on the expensive yoga pants. Wilson stirred up quite the public relations nightmare by publicly saying during a media interview that: "Quite frankly, some women's bodies just actually don't work for it."
Wilson's resignation was prudent, especially for a company that looks to be moving out of its growth stage and maturing, Tawil noted.
"It's a company that that now needs to be concerned about things like that," Tawil stated. "I think [the resignation] speaks to the maturity of the company and that, as an investor, could be the most important takeaway."