VF Corp Heirs Back Activist Investor Engaged Capital in Push for Change
Activist investor Engaged Capital has gained the support of the founding family of VF Corp in its bid for board seats and a faster turnaround at the struggling parent company of popular brands such as the North Face, Vans, and Timberland.
VF Corp, which has seen a 42% decline in its stock value over the last year, has faced challenges in making its brands appealing to consumers during a time of reduced discretionary spending. The Barbey family, descendants of VF Corp’s founder John Barbey, collectively own about 15% of the company and are now calling for the replacement of two board members.
Engaged Capital, managed by hedge fund veteran Glenn Welling, has already successfully urged VF Corp to cut costs and consider selling non-core brands. The hedge fund has identified individuals with expertise in the retail sector and turnarounds as potential director candidates. The deadline for director nominations falls on Tuesday.
VF Corp missed analysts’ expectations in its recent third-quarter results and announced a strategic review of its Global Packs business, which includes brands like Kipling and JanSport. CEO Bracken Darrell, who took the position in July 2023, has implemented layoffs and cost-cutting measures in an effort to turn the company around.
Engaged Capital’s push for change has now gained the backing of the Barbey family, further increasing pressure on VF Corp to address its challenges and implement a speedy turnaround.
Analyst comment
Positive news: The backing of the founding family of VF Corp by activist investor Engaged Capital is positive for the market. With their combined efforts, there is potential for a faster turnaround at the struggling company. If Engaged Capital’s proposed changes are implemented, it could lead to improved performance and increased shareholder value.
