Famed Furniture Chain Under Fire from Activist Investor

Activist investor Doug Bergeron has taken a 5% stake in Ethan Allen Interiors Inc. (Danbury, Conn.) stock and unveiled plans to seek the replacement of its existing five-member board with six candidates. Bergeron – whose career includes leading a $50 million buyout of VeriFone Systems Inc. and a proxy campaign that resulted in the installation of a new board of directors of Cantaloupe Inc., a creator of self-service payment experiences – unveiled those plans in a news release.

Then, in a release issued about eight hours after that of Bergeron, Eathan Allen acknowledged receipt of his proposal, with this accompanying statement:

“The Board and its Corporate Governance, Nominations and Sustainability Committee will review the proposed director nominees and present the board’s recommendation regarding director nominees in the Company’s definitive proxy statement, which will be filed with the U.S. Securities and Exchange Commission and mailed to all Ethan Allen shareholders eligible to vote at the 2026 Annual Meeting.

Ethan Allen shareholders are not required to take any action at this time.”

As for Bergeron, he explained his moves thus: “After extensive diligence, I see a company with an exceptional brand, deep North American manufacturing capabilities and an impressive national retail footprint that should be producing substantially stronger growth. Ethan Allen is materially undervalued today, but with the right board, leadership, strategy and execution, I believe the company has the potential to triple shareholder value over the next three years. The obstacle to growth is not the brand or the underlying business; it is the governance and leadership overseeing it.”

The company’s current board consist of longtime Chairman, President and CEO Farooq KathwariFarook and four independent directors. It currently operates about 170 retail design centers and studios.

Click here for more on Bergeron’s motives and planned nominees for a new board, which he’d like to see voted on at the company’s upcoming annual meeting. Though the date for that session has not yet been disclosed, in recent years it has taken place in early November.