Myer will not replace two outgoing board members after the business’ second largest shareholder, Wilson Asset Management, fired shots at its board size and fees.
The department store said it will not seek replacements for Lyndsey Cattermole and Julie Ann Morrison who will be stepping down as of its upcoming AGM – a decision chairman Garry Hounsell said Myer had been mulling over for a while.
However, the announcement came days after Geoff Wilson, chairman of Wilson Asset Management, said the struggling department store needed to reduce the amount of directors and keep a temporary 16.7 per cent fee reduction permanently.
Hounsell noted that directors fees had been reduced three times in the last two years, and that the current reduced fee structure will remain in place for at least two years.
Wilson also called for the director fee pool to be reduced, something Myer has agreed to review before the upcoming AGM to “ensure it aligns with the company’s current position”.
“Myer takes this opportunity to thank Wilson Asset Management for its ongoing support of the company during what is, and we agree with the comment in your letter, ‘a difficult and uncertain time’,” Hounsell wrote in a letter responding to Wilson.
According to AFR, retail industry sources suggest the announcements could have been made “in cahoots” in an effort to make both sides look good. “The sequence of events is too cute by half,” one source told AFR.
In comments made to The Age, however, it didn’t appear that Wilson felt Myer’s actions had been enough, saying it is within their constitution to have a minimum of four directors – meaning they could lose one more.
Myer’s largest shareholder Premier Investment recently took aim at Myer’s “disasterous and shameful” $172.4 million loss, and chairman Solomon Lew stated Wilson needed to accept that losses will continue to occur unless there is “immediate change”.
Myer’s 2020 AGM will take place on Thursday, 29 October.