Gildan CEO selling up to 28 per cent of his shares in apparel company
MONTREAL — Gildan Activewear Inc. chief executive Glenn Chamandy could earn more than $80 million after deciding to sell up to 28 per cent of his 9.8 million shares in the apparel company.
However, the value of his holdings plunged Wednesday after news of the planned divestiture was released.
On the Toronto Stock Exchange, Gildan shares were down $1.27, or 4.04 per cent, at $30.14 in late morning trading.
Chamandy, the company’s founder, said he has entered into a pre-arranged share disposition plan under which a U.S. financial institution will sell the 2.75 million of his shares once Gildan issues its 2012 results and earnings guidance for 2013 in December.
Under U.S. and Canadian securities laws, company insiders can to sell shares over a predetermined period of time and subject to predetermined volume and price parameters.
The plan can only be established when the insider is not in possession of material non-public information.
Once a plan is established, Chamandy will have no discretion over sales under the plan.
Despite the planned sale of stock over a period ranging up to 24 months, he will remain one of the company’s largest shareholders with a 5.7 per cent stake, which will continue to represent the majority of his personal net worth.
“He has reiterated his personal commitment to continuing to lead Gildan’s growth strategy, as well as his confidence in the future prospects for the company,” Gildan said in a news release.
Chamandy added 2.6 million shares in December 2008 and February 2009.
Gildan manufactures T-shirts, fleece, socks and underwear at low-cost manufacturing sites in Central America, the Caribbean Basin and Bangladesh.
Headquartered in Montreal, it has more than 30,000 employees.