Ackman quits J.C. Penney board
NEW YORK Officials say William Ackman has resigned from J.C. Penney Co.'s board to help resolve a public battle between the activist investor and the struggling department store operator.
Tuesday's announcement follows statements Ackman made last week saying he lost confidence in Plano-based Penney's board and that its chairman should be replaced. Ackman and the retailer's board also were bickering over how quickly it should replace CEO Mike Ullman.
Ackman's investment firm, Pershing Square Capital, has a nearly 18 percent stake in Penney. Penney named Ronald Tysoe as a director to fill Ackman's seat. Tysoe is former vice chairman of Federated Department Stores Inc., which is now Macy's Inc. Penney will name an additional new director later.
Ackman said in a statement that the moves were "the most constructive way forward" for the Plano, Texas, company and all other parties involved. Penney's board also made it clear that it continues to support Ullman, who was brought back as CEO in April. Ullman had previously served as Penney CEO from 2004 to 2011.
The dispute has been a distraction for a retailer trying to dig its way out of trouble. Ullman had replaced Ron Johnson, who was ousted as CEO after 17 months because his radical makeover led to massive losses and sales declines.
Ullman has been working to stabilize the business by bringing back basic merchandise and more frequent sales eliminated by Johnson in a bid to attract younger, hipper customers. But many analysts believe that while traffic is improving, there has been no evidence of a turnaround yet as the company heads into the home stretch of the critical back-to-school shopping period.
There are also increasing concerns about Penney's financial liquidity. Earlier this month the retailer said expects to finish the second quarter with about $1.5 billion in cash on its balance sheet.
Penney is expected to report its second-quarter financial results on Aug. 20. Its stock gained 8 cents to $13.25 before the market open.