V.F. Corp board showdown V.F. Corp Board Conflict: The Barbey Family Backs Engaged Capital

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The North Face Cocktail Party

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Engaged Capital has gained the backing of V.F. Corp.โ€™s (NYSE:VFC) founding family in its clash against the conglomerate known for its ownership of popular brands like North Face, Vans, and Timberland.

Notably, Engaged Capital, holding a 1.3% stake in VF (VFC), has garnered the support of descendants of John Barbey, the visionary behind VFโ€™s creation in 1899. The Barbey family, as reported by Reuters, collectively holds approximately 15% of VF.

In a recent development, Kelly Barbey informed Reuters that the family is advocating for the removal of two long-standing directors from VFโ€™s 12-member boardโ€”Clarence Otis, who has held the position since 2004, and Juliana Chugg, a director since 2009.

According to Reuters, Engaged Capital has zeroed in on individuals with expertise in the retail sector and corporate turnarounds as potential director candidates. The nomination deadline for directors looms on Tuesday.

These events unfold following Engaged Capitalโ€™s initial disclosure of its stake in the renowned apparel and footwear company back in October. The activist investor firmly believes that V.F. Corp (VFC) has the potential to achieve a $40 share price within three years, as indicated in a presentation delivered at an investor conference.

Engaged Capital has set its sights on catalyzing operational enhancements at VFC, including sizable cost reductions expected to yield over $300 million annually. Moreover, the activist group advocates for a strategic evaluation of VFCโ€™s noncore assets and real estate, along with potential board reshuffling. The brands on the possible divestiture list include Timberland, Dickies, Supreme, and Smartwool.

While VFC (VFC) recently announced a strategic review, CEO Bracken Darrell refrained from specifying the brands that might face divestiture, emphasizing that no brand is off-limits.

Adding to the drama, activist investor Legion Partners also holds a stake in VF Corp. (VFC) and is exerting pressure for divestment of brands like Timberland.

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