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The
Danbury, Connecticut-based retailer said Monday it has hired a
nationally recognized executive search firm that is considering
both internal and external candidates. It said the board is
committed to announcing its next CEO no later than June 30,
2027. That's the date on which Kathwari's current contract is
scheduled to end.
The company said that Kathwari will remain a nonexecutive member
of the board after June 30 until the company’s 2027 annual
shareholder meeting.
Kathwari has been president of the retailer since 1985 and
chairman and CEO since 1988, according to the company's website.
He helped take Ethan Allen public in March 1993.
The announcement comes after investor Doug Bergeron, who owns a
more than 5% stake in Ethan Allen, shared publicly earlier this
month that he had launched his own search for a new CEO in
advance of the company's annual shareholders' meeting. A date
hasn’t been set yet, but historically it’s held in November.
Bergeron cited the company's “apparent unwillingness” to address
the need for a CEO succession.
“Ethan Allen has all the ingredients needed to compete and win
in the home furnishings industry," he wrote in a statement
shared on Sept. 10. “What it has lacked is leadership capable of
putting its considerable assets to work.”
In August, Bergeron nominated an alternate slate of six members
for the board for the next shareholders' meeting.
In response to Ethan Allen's announcement on Monday, Bergeron
issued a public statement that the company's acknowledgment that
it needs new leadership is “too little, too late.”
“A board comprised of loyalists to Farooq, who repeatedly
extended his tenure and increased his compensation while he
presided over a shrinking, less competitive, and less valuable
business, is utterly unqualified to select the next CEO of Ethan
Allen,” he wrote.
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