Under Armour CEO Kevin Plank resigns, taps COO Patrik Frisk for top job

A new year will bring a new CEO to Under Armour.Chief Operating Officer Patrik Frisk will replace founder Kevin Plank as CEO on Jan. 1, 2020. Frisk will also join the company’s board, while Plank transitions to executive chairman and brand chief.”Patrik is the right person to serve as Under Armour’s next CEO,” Plank said in the release. “As my partner during the most transformative chapter in our history, he has been exceptional in his ability to translate our brand’s vision into world-class execution by focusing on our long-term strategy and re-engineering our ecosystem through a strategic operational and cultural transformation.”Under Armour shares were up less than 1% in premarket trading Tuesday following the announcement.Frisk joined Under Armour in July 2017 from his position as CEO of Aldo Group. There, like at Under Armour, Frisk worked under its legendary founder, Aldo Bensadoun. Prior to Aldo, Frisk held various leadership positions at VF Corp.He has been a key part of Under Armour’s three-year transformation plan. On the most recent earnings call, he listed “lengthy achievements” the company has logged so far, including optimizing the supply chain and defining the target customer.However, a big part of Frisk’s focus has been revitalizing North America for the brand, which has not yet returned to growth. North America revenue fell 3.2% in its fiscal second quarter, which it reported in July. The company forecast a “slight decline” in the region’s sales for 2019. Previously, the company expected North American sales to be “relatively flat.””The opportunity that lies ahead of us is incredible,” Frisk said in the release. “As our entire global team continues to lean hard into our transformation, I am honored to lead this great brand toward the realization of its full potential.”Often joining Plank for interviews since arriving at Under Armour, Frisk has been the heir apparent, though the timing of the transition has not previously been made public.There have been a number of Under Armour executive departures in recent years including Kerry Chandler, chief human resources officer, in October 2018. Chief merchandising officer Henry Stafford and chief digital officer Robin Thurston left at the same time in 2016.Some critics have called for executive changes in recent years after its disappointing performance coupled with unflattering news reports about its work culture. Last year, the Wall Street Journal reported strip club visits were allowed as work-related expenses at Under Armour, while reports surfaced citing some female and minority employees felt passed over for promotions or otherwise left out of the company’s competitive culture.The company ended the practice of allowing employees to expense visits to strip clubs in early 2018, and sent a statement to the Journal last November that said it “can and will do better.”Plank, 47 years old, founded the company in 1996, working out of his grandmother’s basement while he was still in college. He took it public in 2005 and remains an active CEO inside and outside the corporate walls.Plank is an identifiable face of the brand, often appearing at events with sponsored athletes or other famed executives like Richard Branson, as part of Under Armour’s partnership with Virgin Galactic for new spacesuits just last week.With Plank holding the executive chairman and also the brand chief titles, he will likely remain very involved in the larger direction of the company, while leaving the daily operational details to Frisk.Under Armour’s brand has largely been associated with performance attributes, but many consumers have been buying athletic wear to run errands around town. This shift toward fashion has helped rivals such as Nike, Adidas and Lululemon.As of Monday’s close, Under Armour shares are up nearly 14% since the start of the year. The company has a market value of $9.1 billion. By comparison, Lululemon shares, which have a market value of $26.7 billion, have gained nearly 69% since the year started, while Nike, valued at $150.2 billion, has gained nearly 30% since the year began.— CNBC’s Lauren Thomas contributed to this reporting.

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