The deal resolves a board dispute ahead of the June shareholder meeting and clears the path for incoming CEO Heidi O’Neill.
Lululemon (LULU) shares rose 3% Wednesday after the company reached an agreement with founder Chip Wilson to end a proxy battle. The settlement removes a key obstacle before the June shareholder meeting and allows the board to focus on leadership transitions.
The dispute centered on Wilson’s opposition to the appointment of Nike veteran Heidi O’Neill as CEO, set to take over later this year. Lululemon’s stock has fallen 38% year-to-date amid weak consumer demand and competition, with shares dropping further after O’Neill’s appointment was announced in April.
Under the deal, two of Wilson’s nominees, Laura Gentile and Marc Maurer, will join the board, with a third member to be selected by October 1. The company’s executive chair called the agreement a step toward stabilizing leadership and reviving growth.