At Swatch Group’s annual general meeting (AGM) on Wednesday, shareholders decisively rejected a bid by American investor Steven Wood to secure a seat on the board of the world’s largest watchmaker.
The decision underscores the enduring influence of the Hayek family, which has steered the Swiss company for decades and controls approximately 44% of its voting rights.
Wood, the founder of New York-based GreenWood Investors, which holds a modest 0.5% stake in Swatch Group, had campaigned to join the board as a representative of the company’s bearer shareholders, who collectively own a majority of the share capital but lack equivalent voting power.
His bid was part of a broader push to redirect Swatch’s strategy toward its high-end luxury brands, such as Breguet, Blancpain, and Omega, in a bid to revive the company’s flagging financial performance amid a challenging market for Swiss watchmakers.
However, the Swatch board, led by the Hayek family, had publicly opposed Wood’s candidacy prior to the AGM, urging shareholders to reject his proposal. At the meeting, attendees confirmed that former Swiss National Bank chairman Jean-Pierre Roth garnered significantly more support for a board position than Wood, effectively sidelining the American investor’s ambitions.
A source familiar with the proceedings, speaking on condition of anonymity, described the vote as a clear signal that the Hayek family had “closed ranks” to maintain their grip on the company’s direction.
Wood’s campaign had drawn attention in recent months as he called for Swatch to shift its focus from its mass-market and mid-range brands, such as Swatch and Longines, toward its luxury portfolio.
He argued that prioritizing premium brands could bolster margins and better position the company to compete in a global luxury market increasingly dominated by rivals like LVMH’s watch division and Richemont’s prestigious brands, including Cartier and Jaeger-LeCoultre.
Swatch Group, which reported sales of 7.3 billion Swiss francs ($7.5 billion) in 2024, has faced headwinds from a slowdown in demand for luxury goods, particularly in key markets like China, where economic uncertainty has dampened consumer spending.
The company’s stock has underperformed in recent years, trading at levels significantly below its historical highs, which Wood cited as evidence of the need for strategic change.
In a statement issued before the AGM, GreenWood Investors criticized Swatch’s current approach, suggesting that its “diversified portfolio strategy” diluted the potential of its high-end brands.
Wood, a vocal advocate for shareholder activism, positioned himself as a champion for bearer shareholders, who, despite holding a majority of Swatch’s share capital, are outvoted by the Hayek family’s multiple-voting registered shares.
WHAT YOU SHOULD KNOW
GreenWood Investors is yet to comment on the outcome of the AGM or indicate whether it will continue its activism at Swatch. For now, the Hayek family remains firmly in control, but the debate over Swatch’s future strategy is likely to persist as the company navigates an increasingly uncertain landscape.
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