Men's Wearhouse Mysteriously Dismisses Founder George Zimmer
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Men's Wearhouse dismissed chairman and founder George Zimmer today, and we've never seen anything like it.
The abrupt termination begs for answers about what could have happened.
Here are three reasons why it's a bizarre story:
1. The terse press release. "The Board expects to discuss with Mr. Zimmer the extent, if any, and terms of his ongoing relationship with the Company," Men's Wearhouse said in the statement (see the full thing below). There is no polite mention of the founder's impact on the brand, as would be customary.
2. Shares and profits were gaining. The company just announced last week that profits were up a whopping 23%. Stocks have been consistently gaining over the past few years. This is not a company disaster scenario, a la Ron Johnson.
3. Men's Wearhouse cancelled its shareholder's meeting one day before. This sends a huge red flag to investors at a time when the company is trying its hardest to impress.
Clearly, the circumstances surrounding Zimmer's firing are dramatic.
Here's the company's full, icy press release:
FREMONT, Calif., June 19, 2013 /PRNewswire/ -- The Board of Directors of Men's Wearhouse (NYSE: MW) today announced that it has terminated George Zimmer from his position as Executive Chairman. The Board expects to discuss with Mr. Zimmer the extent, if any, and terms of his ongoing relationship with the Company.
In light of Mr. Zimmer's termination, the Company also announced that it is postponing its Annual Meeting of Shareholders, which had originally been scheduled for June 19, 2013, at 11:00 a.m. Pacific daylight time. The purpose of the postponement is to re-nominate the existing slate of directors without Mr. Zimmer.
The Company expects to announce the rescheduled date, time and location of the postponed Annual Meeting shortly. The Company will set a new record date, provide additional information with respect to the Annual Meeting in a supplement to its proxy statement to be filed with the Securities and Exchange Commissionand commence a new solicitation with respect to the supplemented proxy materials. Shareholders are urged to read the supplement in its entirety, as it will contain important information about the Annual Meeting.