Martha Stewart rejoins her company’s board
Tess Vigeland: Domestic diva Martha Stewart is rejoining the board of directors of her namesake company. After she served five months in prison for insider stock trading, she’d agreed to a five-year ban from the board.
Our senior business correspondent Bob Moon look at whether her return will be a good thing.
Bob Moon: Stewart has served in a creative role for Martha Stewart Living Omnimedia since her release from prison, and she owns most of the company’s shares. Phoenix Partners analyst Robert Routh says her return to a more influential role only makes sense, and he borrows her own catchphrase.
Robert Routh: I think it’s a good thing, because it is her name.
Routh concedes, though, that this move doesn’t guarantee support from investors.
Routh: Some think she did nothing wrong and was, you know, kind of railroaded. There are others that think that they wouldn’t own the stock if it was worth $100, just on principle.
For the record, the stock was actually worth a little more than $3 a share at the close of trading today. The company has been struggling since Stewart’s much-publicized legal troubles. But a restrictive deal with K-Mart has expired now, freeing the company to make deals with other big names for its lifestyle and home fashion lines.
Ad Montage: The Martha Stewart Cook’s Tools Collection, exclusively at Macy’s. Martha Stewart crafts, exclusively at Michaels. Martha Stewart pets, exclusively at PetSmart, created and tested by Martha herself.
That’s not necessarily a good thing. At Stewart Capital Advisors, Malcolm Polley thinks it’s not such a good idea for Stewart to be taking an even more visible hands-on role. He says the company needs to be relying less on her image and shifting its focus to life after Martha.
Malcolm Polley: In this case, the brand at Martha Stewart Omnimedia is Martha Stewart. It’s not the name, it is the person.
Polley points out the company hired Blackstone Advisory Partners a few months ago to explore possible partnerships, spurring speculation the company could go private. Without shareholders to worry about, he says that could make it easier for Martha Stewart Living to remake itself.
I’m Bob Moon for Marketplace.
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