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Engine Capital urges Kohl's to consider e-commerce separation - WSJ

Published 12/05/2021, 06:59 PM
Updated 12/05/2021, 07:01 PM
© Reuters. FILE PHOTO: The logo and trading informations for Kohl's  is displayed on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., January 13, 2020. REUTERS/Brendan McDermid
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(Reuters) - U.S.-based hedge fund Engine Capital LP is urging Kohl's Corp (NYSE:KSS) to consider a sale of the company or a separation of its e-commerce business, The Wall Street Journal reported on Sunday.

The activist investor, which owns a roughly 1% Kohl's stake, wants the department-store chain to examine the two alternatives to improve its lagging stock price, the report said, citing a letter sent to Kohl's board on Sunday.

Engine argues that the company has underperformed both the S&P 500 and other retailers in recent years, the report said https://on.wsj.com/3yapXCV.

Kohl and Engine Capital did not immediately respond to Reuters' request for comment.

© Reuters. FILE PHOTO: The logo and trading informations for Kohl's  is displayed on a screen on the floor at the New York Stock Exchange (NYSE) in New York, U.S., January 13, 2020. REUTERS/Brendan McDermid

In the letter cited by the newspaper, the activist investor also said that assuming online sales revenue of around $6.2 billion, Kohl's digital business alone would be worth $12.4 billion.

Engine also added it believes there are private-equity firms that would pay at least $75 a share and that interactions with potential buyers suggest they could do so by monetizing Kohl's real estate, the report said.

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