Wet Seal hires financial advisors; adopts poison pill
Foothill Ranch, Calif. -- The Wet Seal said it has hired financial advisors and adopted a poison pill that discourages an investor from acquiring 10% of the company.
The move comes as Clinton Group, an investor with a 3.9% stake in the chain, has been putting pressure on the company to put itself on the block.
“We took this action to ensure the board has sufficient time to consider any option,” said Wet Seal chairman Harold Kahn.
The retailer said it has hired Guggenheim Securities LLC and Peter J. Solomon Co. to pursue strategic options to increase shareholder value.
In July, Wet Seal fired its CEO, Susan McGalla, amid declining sales. The chain reported a net loss of $12.4 million for the quarter ended July 28, compared with net income of $2.2 million a year earlier. Second-quarter same-store sales fell 11%.