Kohl’s responds to investors
Presentation addresses claims of inexperience
Kohl’s Corp. responded to the campaign to elect a new slate of nominees to the company’s board of directors in an updated investor presentation Tuesday.
The Menomonee Falls-based retailer is the target of activist investors who seek to take over Kohl’s board of directors. The investors have filed a preliminary proxy with the Securities and Exchange Commission to nominate its candidates for the board of directors.
Kohl’s sales were down 20% in the last fiscal year as the retailer navigated the coronavirus pandemic that closed stores for weeks and changed consumer behavior.
The new investor presentation continued to support Kohl’s current strategy, management and board of directors. The company launched plans in October 2020 with the goal of expanding operating margin to more than 7%.
The company addressed claims by the investor group that the current board of directors does not have the relevant experience to advise Kohl’s. All 12 members on the board have either retail or consumer-facing industry experience and four have been CEO of a retail company, Kohl’s said in the latest presentation.
Kohl’s said that the slate of candidates put forward by the investors have less relevant experience. Four out of the nine candidates nominated by the investors have never sat on the board of a public company.
Kohl’s also launched a new website, kohlsmomentum.com.
The group of investors controls around 9.5% of Kohl’s stock, making it
the largest shareholder in the company. Macellum Advisors GP LLC, Ancora Holdings Inc., Legion Partners Asset Management LLC and 4010 Capital LLC comprise the group.
Last week, the investors said after Kohl’s released its year-end earnings that the sales results and guidance for 2021 “substantiate the immediate need for change on the board.”
CEO Michelle Gass said during a Bank of America consumer and retail technology broker conference call Tuesday that she wants to find common ground with the investors.
“I will say in terms of the ideas that they shared, we’re aligned with many of the ideas that they put forth,” Gass said during the call. Two main differences is that Kohl’s seeks to move forward with its current board and does not see long-term value in the proposed sale leaseback of stores proposed by the investors.
“As it relates to this set of investors, we have had constructive dialogue,” Gass said during the call, according to a transcript filed with the Securities and Exchange Commission.
“We’re looking forward to continuing to have dialogue with them and finding common ground. I will say that the recent news about the nine director slate and more — the takeover of the board is not something that we support.”
Kohl’s stock closed up 69 cents Tuesday at $57.59. The stock’s price has been rising since this fall when shares were selling for around $20.