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Highlights
- Premier seeks shareholder approval to cancel ex-Smiggle exec John Cheston's shares.
- Board cites "serious misconduct" for departure.
- Cheston to join Lovisa, led by Brett Blundy.
Premier Investments (ASX:PMV) has proposed to cancel approximately $4 million worth of shares granted to its former Smiggle executive John Cheston. This move comes after Cheston was dismissed following allegations of “serious misconduct and a serious breach” of his employment terms. The board of Premier Investments has unanimously recommended shareholders approve the share cancellation at their upcoming annual meeting.
The company’s notice details that these shares were issued as part of a long-term incentive scheme. Under the terms of this program, shares may be revoked if an executive is found to have acted “fraudulently or dishonestly” or breached their contractual obligations. Premier Investments alleges that Cheston’s actions meet these criteria, though Cheston denies any wrongdoing.
Cheston’s dismissal follows over a decade with Smiggle, where he oversaw significant expansion, especially in global markets. Under his leadership, Smiggle became one of Premier’s most successful chains alongside Peter Alexander, known for its colorful, trendy products that resonate with younger audiences. Despite this growth, the board’s recent decision reflects a strict stance on governance and adherence to company standards.
Cheston had already indicated his intention to leave Premier, citing a planned move to Lovisa (ASX:LOV), a jewelry retail chain controlled by businessman Brett Blundy. Cheston is expected to join Lovisa’s team in May, succeeding the current executive, Victor Herrero. Blundy, a prominent figure in retail, is also in collaboration with Mark McInnes, a former Premier executive, as they develop a new lingerie and sleepwear brand.
Premier’s share cancellation decision aligns with a previous instance in Cheston’s career. In 2011, he was dismissed from Country Road after a brief 10-week tenure due to allegations of a management buyout attempt. Following this, Cheston pursued legal action and secured a settlement from Country Road, owned by Woolworths Holdings.
On the market front, Premier’s shares (ASX:PMV) saw a slight dip, falling by 10¢ to $33.38. However, over the past year, the company’s stock has experienced a notable rise of nearly 40%, demonstrating investor confidence in the brand’s overall direction despite recent executive changes.
As Premier heads into its annual meeting, the proposed cancellation of Cheston’s shares will be a key item on the agenda. The board’s recommendation to cancel the shares underscores a commitment to upholding ethical standards within the organization, regardless of an executive’s past contributions to the company’s growth.
