(Reuters) - J.C. Penney Co’s board is preparing to name a new director with retail experience as part of an effort to resolve its dispute with hedge fund Pershing Square’s Bill Ackman, the Wall Street Journal reported, citing people familiar with the matter.
Also, as part of the negotiations over board composition, Ackman’s effort to immediately remove interim Chief Executive Myron Ullman would be put on hold, the people told the paper.
The new director is expected to be named as early as Tuesday, the people said. The board may eventually name more new directors as well, a step sought by Ackman, who believes it could help the board function better, one of the people told the Journal. (link.reuters.com/bez32v)
J.C. Penney spokeswoman Kristin Hays told Reuters that the company cannot comment about board matters, including any action that the board may or may not be taking.
Pershing Square officials could not immediately be reached for comment by Reuters outside of regular U.S. business hours.
The public battle between Penney and Ackman escalated late last week with the hedge fund manager demanding the ouster of the retailer’s chairman, Thomas Engibous, as well as Ullman. Ackman had demanded that Ullman be replaced within the next 30 to 45 days.
While Ackman publicly feuds with Penney, other large investors in the struggling retailer are holding off making changes to their holdings.
Soros Fund Management LLC is holding onto its 7.9 percent stake in Penney, a source familiar with the matter said on Monday. The firm, backed by billionaire financier George Soros, had reported earlier this year it owned a big stake in the department store operator.
Another large Penney investor, Glenview Capital Management, also appears to be sitting tight on its “passive” 4 percent stake in the retailer. A person familiar with the hedge fund led by Larry Robbins said the firm has not taken any sides in the public dispute between Ackman and Penney’s board.
Reporting by Sakthi Prasad; Additional reporting by Vijay Vishwas in Bangalore; Editing by Matt Driskill