Ackman's Target Nominees Could Execute His Plans Expertly

(MoneyWatch)  Investor William Ackman has been after Target to heave off the property it owns and its remaining credit card business to boost the company's share price, and he has assembled a slate of nominees for the company's board who seem like the guys who could do the job.

They are, according to a Securities and Exchange Commission filing:

• William Ackman, Pershing Square Capital Management founder, who says Target can form a real estate investment trust with its existing property, spin of 20% of that in an initial public offering and use the money to pay down debt, which will, in his judgment, raise the retailer's share price significantly. Given what's going on with real estate and the stock market these days, others are skeptical. However, with the Target-centric fund he developed to put his plans into effect down 90% after two years, the risk in the plan may look quite acceptable to Ackman.
• Michael Ashner, chairman and CEO of the Winthrop Realty Trust REIT, who oversees property management of more than 20 million square feet of occupied commercial real estate. He also is president and principal shareholder of Exeter Capital Corp., a real estate investment banking firm. Certainly, he has the expertise to execute the REIT plan Ackman has for Target.
• Richard Vague, co-founder and CEO of Energy Plus Holdings LLC, an executive who spent much of his career in the financial services industry, with a focus on consumer credit cards and payment processing. In that capacity, according to the SEC filing, "he earned a reputation as a shrewd competitor, talented executive and an innovator." Vague would bring to the board an authoritative voice on dealing with the credit card business.
• Ron Gilson, the Charles J. Meyers Professor of Law and Business at Stanford Law School and the Marc and Eva Stern Professor of Law and Business at Columbia University School of Law, who the filing characterizes as a "renowned expert in the field of corporate governance, corporate law and corporate acquisitions." Another persuasive voice, he could weigh in on any management or board contention as regards plans for the retailer's future.
• Jim Donald, a former CEO of Starbucks, whose career in food took him from Publix, where he began working at age 16, to Albertsons to Safeway to Pathmark, with a stop at Wal-Mart, where he was "handpicked" by Sam Walton himself to help lead development and expansion of the retailer's supercenter operation, the filing stated. As previously noted in this blog, Target's food operation isn't sufficiently developed to be the recessionary life raft that edibles have become for rivals such as Wal-Mart, Costco and BJ's. In addition to everything else, Ackman may intend to speed development of the food part of Target's business.

The SEC filing quotes Ackman as saying that Pershing Square "has had no previous business relationships with these nominees." However, it's hard to believe that he doesn't know where they stand in relation to his Target plans.