WAUKESHA, Wis. — Despite an impassioned appeal to Target Corp. shareholders, activist investor William Ackman lost his proxy fight Thursday for five seats on the retailer’s board.
Ackman had waged a two-month campaign in which he criticized the board’s stewardship publicly and in Securities and Exchange Commission documents.
A preliminary tally showed the Target-backed slate prevailed with more than 70 percent of votes favoring the reelection of the retailer’s four directors and a proposal to cut the board by one, to 12 members.
Ackman and the other candidates nominated by his Pershing Square Capital Management, which controls about 7.8 percent of Target’s outstanding shares, received from high single digits to more than 20 percent of the vote.
However, Ackman predicted nominating committees at other corporations would be influenced by the Target proxy battle and would be more diligent.
“It’s a great day for shareholders,” Ackman said after the annual shareholders meeting, which was held here at a soon-to-open Target store in this community west of Milwaukee. “It sends a message to companies.”
In an emotional speech to about 300 shareholders before the balloting, Ackman had invoked the Rev. Martin Luther King Jr.’s famed “I Have a Dream” speech.
“I have a dream,” Ackman said. “It’s a dream deeply rooted in the American dream, one day in every corporate election there will be a shareholder candidate and a corporate candidate for each seat.”
Later, he said, “I just got choked up. I’m a softy.”
The investor and hedge fund manager had pledged to keep his shares in Target for five years if he won a seat on the board. But after the meeting, Ackman, without committing himself to a strategy, said he might sell some or all of his holdings.
Ackman said the proxy fight cost Pershing about $10 million. Gregg Steinhafel, Target’s chairman, president and chief executive officer, estimated the retailer spent more than $11 million in defending the incumbent board members and arguing that Ackman’s efforts weren’t aimed at generating long-term value for stockholders.
“I look forward to focusing on retail and building the best retail franchise at Target,” Steinhafel said.
Ackman invested $2 billion in the company through a Pershing Square fund, starting in 2007. But the fund is said to have lost about 80 percent of its value as the stock declined from a 2007 high of about $70 to close Thursday at $39.14.
He has lobbied Target to sell off its credit card portfolio and to spin off its real estate as a way to raise cash and boost shareholder value. Target sold off 47 percent of the credit card unit to J.P. Morgan Chase & Co. in 2008 for $3.6 billion.
The company reported sales of almost $65 billion in the fiscal year ended in January, and set a goal of reaching $100 billion in the next decade, he said.
Target is stepping up its focus on food, including fresh produce, in an effort to get shoppers into the stores more often, Steinhafel said. Apparel makes up about 20 percent of Target’s sales, home accounts for about 20 percent and hardline goods another 23 percent.
Steinhafel said Target isn’t planning another big-name designer to replace Isaac Mizrahi, who parted with the retailer last year. Instead, Target is using a number of emerging designers in different merchandise areas.
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
“These collections continue to build on that vision, empowering differently abled adults to express themselves through fashion,” said @tommyhilfiger of his line of adaptive apparel, which launches today. The line consists of 37 men’s and 34 women’s styles based upon the pieces from the spring Tommy Hilfiger sportswear collection. #wwdnews