An activist investor renews a push to get the department store chain Kohl’s Inc.
to implement measures to increase the lagging stock.
Macellum Advisors GP LLC, which has a 5% stake in Kohl’s, has urged the company to make changes, including changing the board, said people familiar with the matter. Kohl’s has so far rejected Macellum’s request to add board members with retail experience or a shareholder to the board, the people said. The New York hedge fund, which was part of a group that ran a proxy match at the dealer last year, now expects to do it again.
Kohl’s shares rose in the first months of 2021[ads1], but are down about 20% since the activists reached a settlement agreement in April 2021 and are traded below what they were two decades ago. Menomonee Falls, Wis., Has a market capitalization of about $ 7.2 billion.
Macellum tells Kohl’s that if it does not change the board, the company should hire bankers to explore a sale or other transaction. Macellum has told the company that it believes it is potential buyers who have shown interest.
Kohl’s said in a statement that they are continuously exploring all possibilities to maximize shareholder value, and that the strong performance in 2021 showed that the strategy works. It said it plans to share more details about its strategic initiatives and capital allocation plans on its investor day on March 7.
Late last year, another activist hedge fund, New York-based Engine Capital LP, said it owned a stake of about 1% and encouraged Kohl’s to explore a sale.
Over the past year, Kohl’s has made a number of changes, including the reintroduction of dividends and increased share repurchases. It is also investing in its new partnership with cosmetics chain Sephora and updating more than half of its more than 1,000 stores.
Macellum, which focuses on retail, nominated nine directors early last year along with three other activists – including Macellum’s CEO Jonathan Duskin – and encouraged Kohl’s to monetize the property and make changes to its operations. Kohl’s has said that they have previously concluded that such sale-leasebacks for the property will not add value.
The group later reached a settlement agreement when Kohl’s shares were on their way up again, which put two of the nominees and a third director on the board. The agreement prevented Macellum and the other companies from agitating in the company until last week.
The window to nominate board members to Kohl’s board opened on January 12 and closes in mid-February.
Write to Cara Lombardo at email@example.com
Copyright © 2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8