Samsonite International SA said June 1 that Ramesh Tainwala has resigned as CEO and executive director for "personal reasons," with the move coming about a week after activist investment firm Blue Orca Capital LLC targeted the luggage maker in a report.
Kyle Gendreau, Samsonite's CFO and also an executive director, was appointed to replace Tainwala. He will continue to oversee finance and treasury matters until the board identifies his successor.
On May 24, Blue Orca published a report on its website in which it made claims against the validity of Tainwala's academic credentials, which listed a doctorate, and also alleged the company had "questionable accounting practices and poor corporate governance."
Samsonite said in a statement that while its disclosure of Tainwala's educational background has been accurate since the company's 2011 IPO, "the board also takes seriously the allegation" made by Blue Orca.
The company also separately issued a detailed rebuttal to Blue Orca's report, which it called "one-sided and misleading." Samsonite's response also said "the conclusions drawn in the report about the company and its financial results are incorrect."
In addition, it noted that its financial statements had been audited by KPMG, and the accounting firm has not withdrawn its audit opinions or indicated that it intends to do so.
Trading of Samsonite shares in Hong Kong, which was halted May 28, resumed June 1. The share price surged during the day to close up HK$2.65, or 9.85%, at HK$29.55.
The stock had plunged nearly 22% during the previous week in which Blue Orca's report was issued.
