Stewart seeking her replacement on board

She reportedly concedes that she must step down

March 10, 2004|By James T. Madore | James T. Madore,NEWSDAY

NEW YORK - Martha Stewart has acknowledged that she must step down from her company's board of directors and is seeking a replacement capable of representing her interests as the majority shareholder, sources say.

Talks continued yesterday with the six board directors speaking via telephone as they wrestled with the ramifications of Friday's guilty verdict against the domestic entrepreneur. The deliberations also reportedly include her participation in creative activities such as the development of products.

Stewart wants to remain involved in the creative endeavors of Martha Stewart Living Omnimedia Inc., whose roots date back 30 years to a catering business she began in her Connecticut home.

"She has a lot of contributions yet to make," one source said. "But she wasn't begging; that's not her personality to do that. It was a rational discussion," the source said, referring to the face-to-face board meeting Monday at a law office in Manhattan.

A decision on Stewart's future role could be made early as today, another source said. A spokeswoman for Martha Stewart Living declined to comment.

Company executives are seeking to reassure retailers and consumers that Stewart's conviction doesn't doom her homemaking empire. She owns 61 percent of the stock.

On Monday, Sherwin-Williams executives were on the phone multiple times with top executives at Martha Stewart Living to discuss the effects on their paint products and to plan strategies. Similar conversations continue, some involving Martha Stewart Living's chief executive, Sharon L. Patrick.

The message appears to be getting through. A Sherwin-Williams official said he is confident that Martha Stewart Living will persevere despite its namesake's woes. "In our estimation, Ms. Stewart's personal legal situation, although unfortunate, doesn't undermine those things that provide value," said executive Bob Wells.

Sherwin-Williams produces an upscale paint line called Martha Stewart Signature for its 2,200 stores. It provides a separate paint line to Kmart and Sears stores.

Shares of Martha Stewart Living fell for a third day yesterday, losing 35 cents to $9.55 a share.

Newsday is a Tribune Publishing newspaper.

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