Athleisure apparel company Lululemon (LULU) , reeling from a 23% drop in its stock price last week, has added a veteran of publicly-traded retailers to its board.
Lululemon revealed Friday, April 7, that former Gap (GPS) CEO Glenn Murphy has joined the company as co-chairman of its board of directors.
Murphy was Gap's chairman and CEO from 2007 to 2014, before which he was CEO of Canadian pharmacy chain Shoppers Drug Mart. He'll succeed Michael Casey, who will remain a Lululemon director as well as chair of its compensation committee and a member of its audit committee.
The other co-chairman of the board is private equity executive David Mussafer, who assumed the role after his firm, Advent International, bought a 15.8% stake in Lululemon. Advent paid $845 million for the stake in 2014, buying it from founder Chip Wilson after an acrimonious dispute with its board. Wilson said publicly that he had voted against Casey and another director who he said were overly concerned with short-term results.
On Thursday, March 30, Lululemon shares fell 23% as the retailer reported disappointing first-quarter guidance. Wilson, who stills holds an 8.1% stake, blasted CEO Laurent Potdevin, telling CNBC that he has artificially propped up the stock by cutting expenses, masking "a long-term issue with Lululemon."
A Lululemon spokeswoman pointed out by email that during Potdevin's tenure, revenue has increased 47%, from $1.591 billion in 2013 to $2.344 billion in 2016.
"In 2014, he put together a plan, put his team in place, refocused the company on product innovation and operational excellence, and saw those efforts begin to pay off in 2016 when operating income grew 14%," the spokeswoman said.
"Glenn is a seasoned executive with global expertise and I look forward to leveraging his strategic thinking, skills and deep industry knowledge," Potdevin said in a statement.
Potdevin took the helm in January 2014 after serving as president of TOMS Shoes, which is now 50% owned by Bain Capital. Lululemon shares are down almost 14% since he joined and down 24% year-to-date.