In a bid for accelerated transformation at VF Corp (NYSE:VFC), which owns renowned brands like the North Face, Vans, and Timberland, Engaged Capital has garnered support from the founding family, as per a descendant’s statement to Reuters.
Kelly Barbey, a member of the Barbey family, revealed that Engaged Capital, holding a 1.3% stake in VF, has secured the backing of descendants of John Barbey, the company’s founder in 1899. Currently, Barbey family members collectively possess around 15% of VF.
Expressing their stance, the Barbey family aims to replace two directors on VF’s 12-member board, specifically targeting Clarence Otis, a director since 2004, and Juliana Chugg, a director since 2009. They attribute VF’s recent challenges to the alleged failure of these directors to adequately address the company’s issues.
Over the past year, VF shares have depreciated by 42%, significantly underperforming the S&P 500 Apparel, Accessories & Luxury Goods index, reflecting struggles in enhancing brand appeal amidst consumer spending cutbacks.
Engaged Capital, under the leadership of hedge fund veteran Glenn Welling, has previously influenced VF’s cost reduction efforts and exploration of strategic options, including divesting non-core brands. Recently, VF announced certain organizational changes.
Reportedly, the hedge fund has identified individuals with expertise in the retail sector and turnaround strategies as potential director candidates. The deadline for director nominations looms on Tuesday.
While Engaged Capital has been advocating for VF’s transformation since October, the revelation of support from the Barbey family is novel. The response from VF to the family’s demands remains uncertain.