Lululemon's Day says CEO search under way, other executives to be named soon

Thu Jun 13, 2013 4:01pm EDT
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By Solarina Ho

TORONTO (Reuters) - Lululemon Athletica Inc's LLL.TO (LULU.O: Quote) outgoing chief executive said on Thursday the upscale yogawear retailer has begun its search for a new leader and will soon fill other senior positions.

A chief executive search firm has been selected, Christine Day told an investor conference in Chicago.

Day stunned markets on Monday when she said she would step down once a replacement was found. Lululemon shares have plummeted some 20 percent since.

The stock was up 4.3 percent at $67.12 on the Nasdaq and up nearly 4 percent at C$68.22 in Toronto trading.

Day's departure follows the March recall of the company's signature yoga pants because they were too see-through, which led to the departure of its chief product officer and put a blemish on Day's leadership.

"I want to give you that assurance that morale is high, that we're connected, and the reality is, I'm coming back to work on Monday. And I'm there until the next CEO is in place. So it is business as usual for us at Lululemon," said Day. She said earlier she notified the board only last Friday of her decision.

Analysts who spoke to company directors have said they were convinced Day was not forced out.

"We interviewed three Board members and it was clear all were enthralled by Ms. Day, her contribution to the (company) and LULU's performance," said John Zolidis, an analyst with The Buckingham Research Group, in a research note.   Continued...

Pedestrians walk past a Lululemon Athletica store in New York, March 19, 2013. REUTERS/Lucas Jackson