Activist groups seek support for installing independent chair
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Two shareholder groups on Tuesday reportedly filed shareholder resolutions to oust Chipotle Mexican Grill founder Steve Ells as chairman of the beleaguered chain’s board.
Citing Chipotle’s disappointing third-quarter results and slow recovery from a foodborne illness crisis that has slowed traffic, Amalgamated Bank and CtW Investment Group have proposed replacing Ells with an independent director as chairman, according to Reuters.
It’s the latest move by the union-affiliated groups, which pressured Chipotle earlier this year to make board changes.
Chipotle did not immediately respond to requests for comment.
Reuters indicated the non-binding proposal for an independent chair has won support of New York City Comptroller Scott Stringer, whose pension fund owns shares in Chipotle. Remaining silent, however, is activist investor Bill Ackman of Pershing Square Capital Management, who recently took a 9.9-percent stake in the Denver-based chain.
Chipotle, meanwhile, is girding for battle with the activist groups. The company has hired Goldman Sachs and Morgan Stanley; as well as law firm Wachtell, Lipton, Rosen & Katz and crisis public relations firm Joele Frank.
Contact Lisa Jennings at [email protected]
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