Kohl’s Shareholders Ignore Activist Investor, Retain Board

Kohl’s shareholders have rejected a bid by an activist investor to remove 10 members of the retailer’s board of directors as the company prepares for a possible sale.

As The Wall Street Journal reported Wednesday (May 11), each of the company’s 13 directors were re-elected at Kohl’s annual shareholder meeting.

Learn more: Macellum Advisors Urge Kohl’s Shareholders to Shake Up Board of Directors

Kohl’s has been pressured by Macellum Advisors GP LLC, which wants the retail chain to consider changes such as selling and leasing back real estate and selling the company outright.

Macellum urged voters earlier this week to choose its nominees for the board of directors and uproot the status quo at company that the investor argues has fallen short of its potential.

In a letter sent Monday (May 9), Jonathan Duskin, Macellum’s managing partner, urged his fellow shareholders to “elect its aligned and experienced candidates” at the meeting. Last year, the board expanded to 13 members following the addition of Macellum-backed candidates Thomas Kingsbury and Margaret Jenkins.

Kohl’s proxy advisory firm had pleaded last week with shareholders to retain the current board of directors.

Read more: Kohl’s Advisory Firm Urges Shareholders to Keep Current Board of Directors

“We believe shareholders would be best served supporting the current board and its efforts to enhance shareholder value, whether that takes the form of continued oversight of the existing standalone strategy or seeing through the ongoing sale process,” proxy advisory firm Glass Lewis wrote in its recommendations.

The retailer is considering offers from bidders that include private-equity firm Sycamore Partners and Canada’s Hudson’s Bay Co., the Wall Street Journal reported.

Last month, PYMNTS reported that JCPenney owners Simon Property and Brookfield Asset Management were looking to close an acquisition deal for Kohl’s that values the department store at an estimated $8.6 billion.

Kohl’s CEO Michelle Gass told analysts on the company’s Q4 earnings call in April that the retailer’s strategic and financial plan would provide substantial value.

The company is also “testing and measuring that plan against other alternatives,” Gass said, in case its efforts for an omnichannel turnaround fall through, before citing the retailer’s hiring of Goldman Sachs to “engage with interested parties.”