Company Michell & Cía could withdraw its shares from the Lima Stock Exchange

The company Michell & Cía, known for being one of the most prestigious in the world in the manufacture of products with alpaca fiber, called a General Meeting of Shareholders for next Wednesday, March 13, with the purpose of deciding the change of its statutes and the delisting of its shares on the Lima Stock Exchange.

In addition to these topics, the company will discuss the granting of special powers and other requests that are considered pertinent in the session that will be held in person in Arequipa. It is worth mentioning that the summons is signed by José Farfán, representative of the company, and is addressed to the Superintendence of the Stock Market (SMV) and the Lima Stock Exchange (BVL).

Resignations from the board of directors of Michell & Cía

The situation on the board of directors of the Michell group appears unstable, since, from the last two years to the present, there have been four resignations during this short period. The first of them was from Walter Bayli, former CEO of Credicorp, who presented his resignation letter on December 29, 2022.

Three months later, Luis Alberto Chocano left his duties as general manager of the renowned textile company. Likewise, in October 2023, Gonzalo Zuñiga resigned from his position as independent director and, finally, Cayetana Aljovin, the former minister of Pedro Pablo Kuczynski’s government, did the same by resigning from Michell’s board of directors.

To recompose this management space, Giuliana Testino, wife of Michael Michell, was elected on December 6, 2023 as shareholder director. Since then, the company that operates under the name Michell & Cía, owner of various brands with points of sale in Chile, Peru and Australia, has been left with only 4 members on its board of directors: Michael Michell, Gonzalo Bedoya, Frank Michell and Giuliana Testino.

New change in statutes and a possible delisting of shares from the Stock Exchange

On March 31, 2022, the Shareholders’ Meeting of the Michell group approved the partial modification of its bylaws related to the change in the duration of its board of directors from two to one year. As a result, independent and external directors were elected; as a result, Walter Bayli and Cayetana Aljovin resigned months later.

Likewise, they agreed to extend the approval of the audited annual individual financial statements and the 2022 annual report, since the auditing company has not yet finished carrying out its work.

To understand this situation well, it is necessary to mention that EY Peru, a firm dedicated to auditing, consulting and taxes, resigned its services on January 4, 2023 and, in its replacement, PwC was tasked with carrying out this work; However, to date, it has not issued the audit report of the financial statements of the Michell group corresponding to 2022.

The unfinished audits and changes to the statutes in this company dedicated to the manufacturing and marketing of products based on alpaca fiber have been points of debate in its latest agendas. Now, a General Meeting of Shareholders has been called for this Wednesday, March 13 at 11 am in Arequipa and important decisions are expected related to the withdrawal of its shares from the Lima Stock Exchange and a new modification to its internal regulations.

According to economist Omar Azañedo, companies that decide to exclude their shares from the list available on the BVL do so to reintegrate them into the company’s control group. “Perhaps companies like the Michell group, Casandina or others see that their shares are not being traded much, they are not bought or sold. Let us remember that we find ourselves in a context in which investment has been decreasing in recent years in our country and so, for many companies, the stock market is not being a channel to attract shareholders,” he explained.

In this regard, in the last 5 years, more than 10 companies delisted their shares from the Lima Stock Exchange due to the situation of political and economic instability in the country. One of the most recent cases was that of Agrokasa Holdings, which communicated this decision in November of last year, in addition to indicating its intention to make a public purchase offer to the other share holders.

Another of the most recent delistings was that of the Casa Andina hotel chain. In October 2023, it informed the Superintendency of the Securities Market that it was carrying out the exclusion procedure for its common shares to fully recover them.

FACT

• Michell & Cía owns the brands Sol Alpaca, Patapampa Apparel, Michell Factory Outlet, Michell Tops e Hilados and MFH Knits