Bill Ackman Is On A Lonely Island In His Fight For A New Chairman At J.C. Penney
Shares of J.C. Penney (NYSE: JCP), the embattled department store chain, have been extremely volatile over the past several trading days as activist investor Bill Ackman has pushed for more changes at the company in order to return it to profitability.
Ackman owns 17.7 percent of the shares of J.C. Penney after reporting a stake of about 39 million shares.
In the last few days, Ackman has stepped up his push to replace the management of the company and he wants to replace current interim CEO Mike Ullman and the Chairman of the Board in order to turn around the company. However, the Board of Directors fought back against Ackman late last week and now he has a very public board room battle on his hands.
Soros Weighs In
Earlier this year, J.C. Penney shares surged on reports that legendary investor George Soros had taken a stake in the company. However, now he has come out and said that he opposes Ackman's proposals in a boost for the board, further isolating Ackman.
Bloomberg reported headlines that Soros and Glenview Capital Management oppose Ackman's push to mix up the board and support the current Board of Directors. Combined, they own about 12 percent of the shares of J.C. Penney.
Recall, the Board of Directors issued the following statement last week in response to Ackman: "The Board of Directors strongly disagrees with Mr. Ackman and is extremely disappointed that his letter was released to the media at the same time that it was sent to the Board. Mr. Ackman has been integrally involved in the Board's activities since he joined two years ago. This includes leading a campaign to appoint the Company's previous CEO, under whose leadership performance deteriorated precipitously. His latest actions are disruptive and counterproductive at an important stage in the Company's recovery."
J.C. Penney shares popped higher on the news to as high as $13.43 per share before pulling back to $13.16, a gain of 2.33 percent on the day. Shares have bounced off of the 52-week lows made recently at $12.34.
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.