Kohl’s CEO Michelle Gass Is Stepping Down and Joining Levi Strauss as President
Kohl’s said today that Michelle Gass will step down from her role as CEO and member of the board of directors, effective December 2. She will be joining Levi Strauss & Co. as president and is in line to succeed CEO and president Chip Bergh within the next 18 months.
Tom Kingsbury will serve as interim CEO until a successor is named. The board has formed a committee to search for a replacement.
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The departure comes at a turbulent time for the Menomonee Falls, Wis.-based retailer, which has faced increasing pressure from activist investors in recent months to turn its business around and instate new leadership. In September, Ancora Holdings, which owns 2.5% of shares at Kohl’s, asked the board of directors to oust Gass and chairman Peter Boneparth. The investor emphasized the need for leaders with more experience in turning around a business at “this critical fork in the road” for the company.
Ancora leadership praised the CEO shift at Kohl’s following the Tuesday announcement.
Kohl’s has also faced pressure from Macellum Advisors, which owns nearly 5% of shares at Kohl’s. The group in January sent an open letter to other shareholders to call out Kohl’s for “mismanaging” the business and “failing to implement necessary operational, financial and strategic improvements.” A week later, the activist investor advised the company to strongly consider a sale of the company and also asked for Kohl’s to put a Macellum representative on the board.
In September, Kohl’s was named in a new class action lawsuit that accused the retailer of misleading shareholders about the “company’s business, operations and compliance policies,” including failing to disclose that the company’s strategic plan was not engineered in a way to help the company achieve its goals.
The company also failed to complete a negotiation to sell itself a few months ago. After entering into exclusive negotiations in early June with Franchise Group to discuss a potential sale of its business, Kohl’s said on July 1 that it withdrew from the process. Other reports in September revealed that Kohl’s was in talks with private equity firm Oak Street Real Estate Capital LLC to discuss potentially selling its real estate assets for around $2 billion.
Gass served as CEO of Kohl’s since 2018. She joined the company in 2013.
“I am incredibly proud of what the team at Kohl’s has accomplished and I’m very confident in their ability to drive continued innovation, growth and value for customers,” Gass said in a statement. “Kohl’s associates and brand partners are an inspiration to me, and I am truly grateful to have had the opportunity to work with this great team and company.”
In August, Kohl’s Corp. cut its outlook for the year after reporting a hit to its business in Q2 from macroeconomic headwinds. Gass said inflation and weaker consumer spending, especially among middle-income customers, impacted the company’s results in the quarter.
Bob Eckert, chairman of Levi Strauss & Co’s board of directors, said the Gass’ “deep retail and omni-channel experience combined with her track record of building brands and meaningful innovation is a perfect fit for the skills needed to lead this company for the long term and create significant value for our stakeholders.”
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