Clinton Group Fires Back at Wet Seal (WTSLA) Board
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Today Clinton Group fired off a letter in response to The Wet Seal's (NASDAQ: WTSLA) board of directors criticism of its plans for change. Clinton Group is the company's second largest shareholder.
"The Company's performance over the last five years has been extremely frustrating and unnecessarily poor, as the Board has made a series of hiring and strategic missteps and failed to optimize the balance sheet. All the while, the Board has been content to re-nominate themselves as directors, despite the fact that none of them have specialty retail or recent operating experience," said the letter.
"The Company has no Chief Executive Officer. We do not believe stockholders should entrust this critical decision to the current Board. They have not made good hiring decisions in the past. We have no reason to believe their judgment on executives has suddenly improved," continued Clinton Group. The letter goes on to include the following:
"We are pleased that Institutional Shareholder Services (ISS) and other research analysts agree with us that changes in the composition of the Board are warranted. We encourage you to support our proposals as well."
"We also write – with apologizes for taking your time on this topic – to correct the hysterical and misleading letter issued by the Board yesterday. With the high level of support we are receiving, the Board is understandably feeling some pressure. Given their inability to defend their own track record (a stock that is down 50% on their watch while same-store sales have been negative in more than 75% of the last 60 months), they have instead turned to the refuge of the indefensible: attacking the messenger. Their letter is shameful."
"The Company's performance over the last five years has been extremely frustrating and unnecessarily poor, as the Board has made a series of hiring and strategic missteps and failed to optimize the balance sheet. All the while, the Board has been content to re-nominate themselves as directors, despite the fact that none of them have specialty retail or recent operating experience," said the letter.
"The Company has no Chief Executive Officer. We do not believe stockholders should entrust this critical decision to the current Board. They have not made good hiring decisions in the past. We have no reason to believe their judgment on executives has suddenly improved," continued Clinton Group. The letter goes on to include the following:
"We are pleased that Institutional Shareholder Services (ISS) and other research analysts agree with us that changes in the composition of the Board are warranted. We encourage you to support our proposals as well."
"We also write – with apologizes for taking your time on this topic – to correct the hysterical and misleading letter issued by the Board yesterday. With the high level of support we are receiving, the Board is understandably feeling some pressure. Given their inability to defend their own track record (a stock that is down 50% on their watch while same-store sales have been negative in more than 75% of the last 60 months), they have instead turned to the refuge of the indefensible: attacking the messenger. Their letter is shameful."
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