NEW YORK – In the wake of shareholders’ rejection of Eddie Bauer’s takeover by a private-equity group, Fabian Mansson on Friday resigned as president, chief executive officer and a director of Eddie Bauer Holdings Inc.
Howard Gross, an Eddie Bauer director, has succeeded Mansson on an interim basis as a search for a permanent successor begins. Gross is a 35-year retail veteran who previously headed the Limited Stores and Victoria’s Secret Stores divisions of Limited Brands. He was also CEO of Hub Distributing, operators of Anchor Blue and Levi’s and Dockers outlet stores, when it was sold in late 2003 by American Retail Group to Sun Capital Partners.
Sun Capital and Golden Gate Capital constituted the investment vehicle which, on Thursday, was rejected in its bid to take over Eddie Bauer, and take it private, for $9.25 a share, or about $277.7 million, plus the assumption of about $328 million in debt.
Approval of the takeover required a majority vote of the company’s shares. But only 44% of the more than 30 million shares outstanding were voted in favor of the merger while about 37% were cast against the transaction.
Mansson joined Redmond, Wash.-based Eddie Bauer as CEO in July 2002 following two years of consulting and work in venture capital. But he established his name in chic fashion retailing during a nearly decade-long stay with Hennes & Mauritz, culminating in a two-year stint at the helm of the company, which is based in his native Sweden.
“On behalf of the entire board, I’d like to thank Fabian for his leadership over the past four and half years,” said Bauer chairman William Land. “He guided the company through its difficult reorganization and the early stages of its turnaround and restored positive sales momentum this past holiday season with the refocusing of the company’s product line.”
Gross said, “Our board is committed to taking the necessary actions to put Eddie Bauer on a path to improve its performance and capitalize on the strong potential of its brand. We are moving forward thoughtfully and expeditiously to position the company to executive its turnaround strategy.”
The press release said the firm was “evaluating appropriate next steps for the company to effectuate its turnaround.”
The shareholders meeting at which the merger was rejected was originally scheduled for Jan. 25 but was delayed until Thursday after the firm, as it reviewed financial results for 2006, discovered possible errors in previous statements. Had the errors been confirmed, they would have required restatement of earlier results, but revisions weren’t found to be necessary.
Buffeted by a $117.6 million impairment charge, Eddie Bauer endured a $275.1 million loss during the first nine months of the just-concluded fiscal year. Revenues dropped 7.5% to $631.5 million. Fourth-quarter and full-year results haven’t yet been released.