J.C. Penney adopts a “poison pill”

[TexasTowelie]

J.C. Penney Co. is trying to buy some time to right itself without having to also fight a battle for control of the 111-year-old department store chain.

J.C. Penney’s board has adopted a shareholder rights plan designed to prevent investors from gaining control of the company.

The rights plan, also known as a poison pill, is for one year and was adopted after it consulting with outside advisers.

The move comes a week after hedge fund manager and Penney’s largest shareholder Bill Ackman resigned from Penney’s board. Tuesday he told his hedge fund investors that he may sell his 17.7 percent stake, but wasn’t sure when. Ackman and Penney also agreed to a plan for his exit last week.

More at http://bizbeatblog.dallasnews.com/2013/08/j-c-penney-adopts-a-poison-pill.html/ .

[taught_me_patience]

1. Clueless board

They should welcome a buyout, as this POS is circling the drain real fast. 20 years of mismanagement will do that...

[Warpy]

2. The board just lost sight of who the customers were

and/or became terrified they'd all suddenly die off.

Penney's doesn't sell to the trendy or teenagers, although it's tried to recently and been completely rebuffed. It sells to people who are in their mid 20s and up who need reasonably priced, professional looking wardrobes. It's been like that since I can recall. That's a very large and very loyal customer base and Penney's has been trying to throw it away by cheapening their clothing (lots of plastic) and trying to be trendy.

That is not a recipe for continued success.

[Arctic Dave]

3. Gee, ya mean to tell me a "Hedge Fund Manager"

tanked them with his idiotic plan?

Shocked I tell ya!

[eilen]

4. true. JC Penney is the place

to find the basic white blouse, an interview suit, your kid's school uniforms, a graduation/first suit for a boy, communion clothes. For some communities you get bridesmaids dresses there, decent underwear/bras, school clothes.

I used to buy my son's clothes there and at Sears.

It is also a place to get kids portraits done, new luggage, and towels and sheets during a white sale. Penney's was always a dependable dept. store-- nothing flashy but solid, quality goods. Their main competition was Sears. I think both stores are suffering from market share as more customers drift over to Target, Walmart and Kohls.

[onethatcares]

5. when they took over Eckerd Drug Co. in Florida

an ran it into the ground prior to selling out to Brooks LTD of Canada I swore I'd never purchase a pennys worth of anything from there.

My wife lost her job in that shuffle, so I find it very hard to shed a tear for them.