Men’s Wearhouse is finally opening up about its reasons for kicking founder George Zimmer to the curb as executive chairman, saying Tuesday that he tried to wrest back control of the company and wanted to take it private.
The lengthy disclosures came in stark contrast to the retailer’s terse announcement last week in which it said it was delaying its annual shareholder meeting and that it expected to discuss with Zimmer his future relationship with the brand.
Other details were scarce until Monday, when Zimmer stepped down from the board. In a resignation letter, he blamed his firing on a backlash against his “growing concerns with recent board decisions and the strategic direction of the company.”
The Fremont retailer returned Tuesday with its own version of events, saying that Zimmer had “difficulty accepting the fact that Men’s Wearhouse is a public company with an independent board of directors and that he has not been the chief executive officer for two years.”
The company said Zimmer – known for spouting the phrase, “You’re going to like the way you look. I guarantee it” in television commercials – began clashing with Doug Ewert, the current chief executive and Zimmer’s handpicked successor.
Zimmer “eventually refused to support the team unless they acquiesced to his demands,” according to Men’s Wearhouse.
Among those ultimatums, according to the company: “significant changes” that Zimmer advocated in order to “enable him to regain control” as “the sole decision maker,” none of which gained traction with board members or top executives.
After years resisting privatization, he began arguing to sell Men’s Wearhouse to an investment group, the retailer said.
But the board added that it is “unanimously of the view that now is not the time to sell the company,” saying that the debt load and threat to company culture would make such a move “a very risky path on many levels.”
Men’s Wearhouse also said Zimmer sought veto power over major corporate decisions and wanted executive compensation.
Then there was the matter of K&G Superstores. The board said Zimmer reversed course on the Men’s Wearhouse’s discount brand, first backing a review of strategic alternatives pitched by management and supported by the board before changing his mind.
Still, the company said, it didn’t want “a total breakdown of the relationship” with the man who founded Men’s Wearhouse four decades earlier.
“Our actions were not taken to hurt George Zimmer,” the board said in its statement. “Rather we were focused on what we believed to be in the best interests of Men’s Wearhouse, as well as shareholders and employees.”