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 A duo of activist investors seems to be having mixed luck with its efforts to press for changes at Charming Shoppes Inc., a Bensalem, Pa.-based retailer of women's plus-size apparel best known for its Lane Bryant brand.
Hedge funds Crescendo Partners and Myca Partners have launched a proxy contest to install three director candidates on the company's board at its May 8 scheduled annual meeting. But influential proxy advisory services company Glass, Lewis & Co. LLC only recommended one of the dissident duo's slate, Michael Appel. The proxy advisory services company did not recommend institutional investors vote for Crescendo director Arnaud Ajdler and Myca official Robert Franfurt. A split recommendation is a favorite tool for the proxy advisory service firms in cases where they don't want to appear too supportive of the dissidents or the management-backed incumbents. Even so, Appel's presence will likely help advance the share-value improvement goals of Crescendo and Myca. Appel's experience as a retail-focused managing director at Quest Turnaround Advisors would likely bring a deal-oriented focus to Charming Shoppes. Though, company officials complain that his lack of experience as a director or in the apparel industry makes him a bad candidate. Also, largely in response to the activists, Charming Shoppes announced Friday it has retained Banc of America Securities LLC and Lehman Brothers Inc. as financial advisers to assist the company in seeking "strategic alternatives" such as selling its "noncore misses apparel catalog titles in order to provide a greater focus on its core brands, Lane Bryant, Catherines and Fashion Bug, and to enhance shareholder value." That kind of restructuring is exactly the kind of thing activists are looking for. Even if Crescendo and Myca don't get all three of their candidates on the company's board, they can always come back next year with additional nominees. Additional coverage will come later in The Daily Deal and on TheDeal.com. - Ron Orol See press release about auction from Charming Shoppes Ron Orol is a Washington-based reporter for The Deal and author of Extreme Value Hedging: How Activist Hedge Fund Managers Are Taking on the World. Categories Deal Video
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