Barington Capital Drops Proxy Fight at Chico's

Activist investor Barington Capital Group LP said Friday it is dropping its fight for board seats at apparel chain Chico's FAS Inc., and took credit for recent changes at the retailer nearly two months after it launched its proxy campaign.

Barington, which owns a 1.4% stake in Chico's, said it would drop its bid after proxy advisory firms Institutional Shareholder Services and Glass Lewis agreed with Chico's that the recently-appointed chief executive, Shelley Broader, should be given time to drive profitable growth.

"For the past several months, we have worked tirelessly to ensure that positive changes are made at Chico's," said James A. Mitarotonda, chairman and CEO of Barington. "Our efforts have undoubtedly increased the pressure on the board and management to address the issues we have raised and to deliver actual results to shareholders."

Chico's recently has announced more than $50 million in cost cuts and the replacement of two directors on its board, among other changes. A representative for Chico's couldn't be reached for comment.

Barington said it still would like to see Chico's decentralize the company's "large corporate infrastructure," further cut expenses and improve executive compensation practices.

In May, the company reported earnings and revenue in its latest quarter missed Wall Street's expectations.

Chico's stock rose 1% to $11.67 in morning trading in New York.

Write to Joshua Jamerson at joshua.jamerson@wsj.com

(END) Dow Jones Newswires

July 15, 2016 11:15 ET (15:15 GMT)

Chicos FAS (NYSE:CHS)
Historical Stock Chart
From Mar 2024 to Apr 2024