Ted Baker CEO in leave of absence as more allegations emerge
Things are moving fast at Ted Baker and just a few days after allegations emerged about a “forced hugging culture” at the company, comes news that its CEO is now on a voluntary leave of absence.
And COO Lindsay Page has been named as acting CEO with immediate effect while Kelvin remains on leave. Page is a very different exec to Kelvin, who has been the firm’s creative force, while the well-respected Page comes from a more finance-focused background.
The news came late Friday as the company said that the committee investigating the allegations “and the board have now been made aware of further serious allegations about the conduct of Ray Kelvin, which it will also be investigating.”
Ted Baker had announced only on Monday that it had appointed an independent committee of non-executive directors “to ensure that the views and concerns raised in recent media reports and a petition are recognised and carefully considered and that appropriate responses are taken forward.”
It didn’t say on Friday what the new allegations comprised.
On Friday, it explained that Ray Kelvin has agreed, for the benefit of the business and the people who work in it, “that he will take a voluntary leave of absence from his role with the company while these allegations are investigated.”
The company said it “will not make any further comment about the nature of the allegations that have been made while they remain under investigation.”
The latest announcement was made just around the time that the stock exchange closed for the weekend so share price reaction won’t be seen until next week. That’s perhaps a relief for the firm after its shares had fallen heavily earlier in the week (recovering only slightly after its Thursday trading update) and dented its overall market capitalisation.
The big question is, what is likely to be the end game as far as this story is concerned? Ray Kelvin isn’t just the CEO but the brand’s founder and still its biggest shareholder with a holding of around one-third of the company. While that gives him a lot of power, it also means he’ll want to ensure that his shares stay as valuable as possible.
They had already fallen from a value of over £32 each in March to around £18 last Friday on concerns around slowing growth. But they closed below £15 on Friday. It will be interesting to see what they do when the share markets re-open on Monday.
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