Proxy advisors disagree on Forzani board nominees
Proxy advisors have been weighing in on the Forzani Group's (TSX: FGL) proxy battle with New York hedge fund Crescendo Partners, which opposes two Forzani nominees for election to the board of directors.
Proxy advisor Glass Lewis & Co. said that shareholders should vote for all eight Forzani nominees, concluding that the dissident "failed to make a compelling case against the company's current board and management."
Shortly after, proxy advisor RiskMetrics Group advised shareholders to vote for six of the eight Forzani nominees and one dissident nominee.
RiskMetrics, despite its recommendation, said it "recognizes the considerable achievements made by the company, the steps taken and the initiatives currently underway." The report had no criticism of Henri Drouin and Donald Gass, the two Forzani nominees that RiskMetrics did not support.
In response, John Forzani, chairman of the Forzani Group, said in a statement, "We respectfully disagree with RiskMetrics' recommendation that shareholders should vote for even one of the dissident nominees. In our view, the dissident does not represent the interests of all shareholders, is less qualified than either Mr. Drouin or Mr. Gass, and if elected could have the unintended consequence of weakening the board's ties to our franchisees in Quebec who deliver approximately one-third of Forzani's retail sales."
Forzani added, "The board changes proposed by the dissident would be disruptive and unnecessary, and may jeopardize the continued swift and effective execution of FGL's strategic plan."
Canada's largest national retailer of sporting goods, Forzani operates sores under various banners, including Fitness Source, Sport Chek, Coast Mountain Sports and Sport Mart.
Iconix proposes equity offering
Iconix Brand Group (Nasdaq: ICON), parent of Danskin Fitness, said it has contacted the SEC with a proposed public offering of its common stock shares for the company and certain stockholders.
Iconix said it's looking at offering 9.2 million shares of the company's common stock and the selling stockholders will offer 800,000 shares. The selling stockholders include Neil Cole, the company's CEO and chairman, and two of the company's directors.
The company also expects to grant to the underwriters an option to purchase up to an additional 1.5 million shares. It intends to use the proceeds for general corporate purposes, which may include the funding of acquisitions. The public offering price has not yet been determined.
The company said it also anticipates filing a preliminary prospectus supplement. Barclays Capital and Lazard Capital Markets are acting as joint bookrunning managers for the offering, with Credit Suisse Securities acting as the co-manager for the offering.
Costco's Q3 profit falls 29 percent
Third-quarter profit for Costco (Nasdaq: COST) dropped 29 percent on softer sales and a litigation charge.
Earnings for the quarter were $209.6 million, or $0.48 per share, versus $295.1 million, or $0.67 per share, a year earlier.
Included in the results was a $34 million, mostly non-cash, pre-tax charge related to a settlement of a class-action lawsuit over its membership renewal policy, it said. Increased employee health care costs also weighed on its quarterly performance, it added.
Revenue dropped 5 percent to $15.81 billion from $16.61 billion.
Same-store sales slipped 7 percent for the quarter, with U.S. same-store sales off 5 percent and international same-store sales down 12 percent. Excluding the impact of lower gas prices and the stronger dollar, same-store sales rose 2 percent.
Given the uncertainty of the economy, Costco management did not issue any earnings guidance.
--Compiled by Wendy Geister
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