MINNEAPOLIS – Responding to activist investor pressure, Buffalo Wild Wings Inc. appointed three new independent directors to the company’s board of directors. The moved prompted a firm response from the investor, Marcato Capital Management LP which had said in August that it would be “inappropriate” to appoint additional directors without consulting major shareholders.
The new members are Andre Fernandez, president of CBS Radio, Hal Lawton, senior vice president of North America at e-Bay Inc. and Harmit Singh, executive vice president and CFO of Levi Strauss & Co. As part of the board shuffle, directors Dale Applequist and Warren Mack retired from the board effective immediately.
“On behalf of the Buffalo Wild Wings Board, I’d like to thank Dale and Warren for their many years of service and dedication to the company,” James Damian, chairman, said in a statement. “Their decision to retire early upon our identification of three new, highly qualified directors demonstrates their commitment to enhancing Buffalo Wild Wing’s governance through refreshment.”
Mick McGuire, founder of Marcato Capital Management LP, has been pushing the Buffalo Wild Wings board for significant changes. Marcato is the chain’s fourth-largest investor with a 5.2 percent stake in the company. Among the changes McGuire sought was fresh talent at the board of directors and management levels. In a statement, Marcato expressed disappointment that management shuffled the board with consulting Marcato or other outside shareholders.
“Rather than working collaboratively with its investors, Buffalo Wild Wings has opted to exercise poor judgment, taking entrenching actions to create the illusion of change without showing any real openness to new voices and desperately-needed new ideas,” the investor said in the statement. “Marcato has raised a number of significant strategic, operational and financial issues. We are convinced that, even with these new additions, the board lacks a sufficient level of restaurant operations and franchise system development expertise and would benefit further by adding shareholder representatives.”
But Sally Smith, president and CEO of Buffalo Wild Wings, said Fernandez, Singh and Lawton bring “key expertise, strong values and financial acumen” to the company’s board.
“Their appointments underscore our commitment to proactive board refreshment, strong corporate governance and independence and diversity across our Board. We look forward to working with Andre, Harmit and Hal and are confident that their insight will benefit Buffalo Wild Wings as we continue to drive value for our shareholders,” Smith said in a statement.
Fernandez is responsible for the overall direction and management of CBS Radio which includes 117 radio stations in 26 major markets. Fernandez currently serves as vice chairman of the board at Froedtert Health and he is on the board of the National Association of Broadcasters. He graduated cum laude from Harvard Univ. with a degree in economics.
At e-Bay, Lawton is responsible for all functions for the Americas business unit including merchandising, marketing, operations, business selling, consumer selling, global shipping, global payments and global customer experience. He earned a bachelor’s degree in chemical engineering and pulp and paper science from North Carolina State Univ. before pursuing an MBA from the Darden Graduate School of Business at the Univ. of Virginia.
Singh manages the finance, information technology, strategic sourcing and global business services functions at Levi Strauss & Co. He holds a bachelor’s degree from Shri Ram College of Commerce, Delhi Univ., and is a Chartered Accountant from India. He is also a member of the CNBC Global CFO Council and Wall Street Journal CFO Network.
