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The war of words between Myer and its major shareholder, Solomon Lew's Premier Investments, has taken a major turn with the department store chain accusing Lew of running a "hostile and obstructive" campaign to destabilise the company.
Myer CEO Garry Hounsell fired back at Premier Investments' latest hostile attack which followed a slide in third quarter sales. Premier Investments also accused Myer of "extreme discounting" which it says led to the decline in sales.
"Premier Investments continues to be engaged in a hostile and obstructive campaign that appears to be designed to destabilise Myer," Hounsell says in a letter to shareholders.
"Premier Investments is conflicted because of its position as a major supplier and competitor to Myer," he says.
Hounsell also denied Myer had been engaged in a program of "extreme discounting" during the past three months which led to the retailer reporting that its third-quarter sales dropped 2.7 per cent to $635.3 million.
Solomon Lew (pictured right with CEO Mark McInnes) has made no secret of the fact that he wants to replace the Myer board because of its declining sales and on Friday he penned his own acrimonious letter slamming Myer and its executives, warning that the company is on the cusp of a devastating net loss at the full year.
Lew also criticised Hounsell for taking a salary of $83,000 per month in the role he took up after CEO Richard Umbers stepped down in February.
Myer's response on Tuesday night says Hounsell was "not self-appointed as Premier claims" and that there was an appropriate board process following Umber's departure with an independent committee to review Housell's performance.
The bitter and personal tit-for-tit accusations continued on Wednesday with another statement issued by Premier Investments saying it did not dispute its contention that Myer is "softening us up for another profit downgrade during Q4 by blaming the weather".
Premier also contends that Myer has not disputed its claim that it will report a very substantial net loss for the financial year.
"Myer shareholders can see clearly what is going on here. It's a shame the Myer Board still has its eyes wide shut," Premier Investments says in its statement on Wednesday.
"When Mr Hounsell was appointed Chairman-Elect of Myer (September 2017), he heavily supported the now departed CEO Mr Umbers and the "New Myer Strategy".
"Further, Mr Hounsell told the market he could see the 'green shoots' of Myer's turnaround strategy appearing.
"To date, instead of 'green shoots', all Mr Hounsell has produced is: a share price down 36 per cent; the cancellation of the interim dividend; a market capitalisation reduction of more than $200 million; write down costs of close to a massive $550 million; and current year to date sales down 3.4 per cent. The numbers don't lie!
"Premier is in discussion with Myer shareholders with a view to replacing Myer's failed board with a new set of expert, highly-qualified directors who can rescue the company.
"History will judge harshly those who stand by and allow Myer to fail."
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