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Post-Chap. 11 Board Proposed by Kmart

NEW YORK — Kmart Corp.’s investor constituent groups have submitted to the Chicago bankruptcy court a list of nominees for the nine-member board that will oversee operations following the discounter’s expected exit from Chapter 11 at...

NEW YORK — Kmart Corp.’s investor constituent groups have submitted to the Chicago bankruptcy court a list of nominees for the nine-member board that will oversee operations following the discounter’s expected exit from Chapter 11 at the end of the month.

This story first appeared in the April 3, 2003 issue of WWD.  Subscribe Today.

As expected, Julian Day, chief executive officer, is one of the proposed board members, as is Edward Lampert, chairman of ESL Investments. Lampert will be one of the chain’s principal owners after its exit from bankruptcy proceedings.

As reported, all current board members will be replaced. James Adamson, who led Kmart through the bulk of its tour of duty in bankruptcy court, will remain chairman until Kmart’s exit from Chapter 11.

Also nominated by Kmart’s investors, creditors and lenders include two others from ESL: William Crowley, president and chief operating officer, and Steven Mnuchin. The two previously were affiliated with Goldman Sachs. Also serving on the board is a representative from Third Avenue Management, Brandon Stranzl, a senior research analyst. Stranzl’s firm oversees the Third Avenue Value Fund, which, in tandem with ESL, will have a majority position in the new Kmart.

Others named to the board are: Ann Reese, former chief financial officer of ITT Corp.; William Foss, an attorney in San Francisco who previously worked as general counsel for a division of LVMH Moët Hennessy Louis Vuitton; E. David Coolidge 3rd, who heads up William Blair & Co., an investment firm in Chicago, and Thomas Tisch, managing partner at a private investment firm in New York.

The nominations would become official if approved by the bankruptcy court along with other elements of its reorganization plan. Approval is expected during court hearings on April 14 and 15.

Earlier this week, Kmart said it would eliminate about 660 jobs, about 400 of them at its Troy, Mich., headquarters, through terminations and attrition.

In addition to his large holdings in Kmart, Lampert has major stakes in AutoZone Inc. and AutoNation and has acquired a 9 percent position in Sears, Roebuck and Co. stock. The breadth of his ownership has strengthened speculation that Sears might occupy some Kmart locations and use them to house its Great Indoors concept.