Deckers issues letter to stockholders urging vote in favor of company's director nominees

Deckers on Wednesday announced that its Board of Directors is sending a letter to stockholders highlighting support from leading proxy advisory firm Glass Lewis and sell-side analysts.  

Deckers highlights strong board and results ahead of annual meeting - Deckers

The Board of Directors unanimously recommends that stockholders vote “for all” of Deckers’ highly qualified and experienced nominees using the White proxy card. The letter reads, “We ask that you take a moment to vote to protect the value of your investment in Deckers. Since time is short, we encourage you to vote by telephone or by Internet.”
The parent company of Ugg and Teva first filed a letter to stockholders in November, following a lawsuit from Marcato Capital Management. Marcato, which took 6% of Deckers’ Outdoor Corporation in February, had criticized the company over the course of 2017, including its retail expansion and its “failed business strategy.”
The activist hedge fund this month decreased the Deckers Outdoor Corporation board from nine members to three members, most likely in an attempt to make changes at the company.
Marcato believes that Deckers’ share price could more than double by 2020 if the company sells off pieces of its footwear business, buys back shares and overhauls executive compensation, a plan with which Deckers disagrees and describes as “outdated,” as well as “self-serving and detrimental.”
“As you may know, in a last-minute and desperate attempt to gain board representation, Marcato Capital Management has abandoned its previously announced strategy for a change in the composition of a majority of the Deckers Board and is now seeking any representation on the Deckers Board that it can get,” reads the letter to Deckers stockholders.
“Don’t be fooled: Marcato is continuing to put the value of your investment in Deckers at risk by advocating for a series of value-destructive proposals and the election of three nominees who lack the relevant skills and experience to continue our successful transformation. Don’t let Marcato interrupt Deckers’ transformation.”
Deckers also said that Marcato has a “history of empty promises,” and mentioned the firm’s plan to sell restaurant chain Buffalo Wild Wings for $157 per share, or “one-third of the share price that Marcato touted during its proxy contest.”
A vote “for all” of Deckers’ nominees, according to the company, is a vote for sustainable growth, greater profitability through a transformed cost structure, and a superior board with a track record of success and a plan for continued refreshment.
“In our view, the Company appears to have the right board and plan in place for Deckers at this pivotal juncture for both the Company, and the retail and branded products industry,” said Glass Lewis.
“The Company’s strategic and cost savings initiatives implemented both before and since Marcato arrived on the scene have begun to show positive results in terms of margin improvement and growth.”

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