Target puts temporary stop on efforts to sell credit-card receivables
Minneapolis — Target Corp. on Wednesday announced it is temporarily suspending its efforts to sell its credit-card-receivables portfolio until later this year or early 2013. The company also outlined plans to pay J.P. Morgan Chase & Co. about $2.8 billion, along with a make-whole premium, to retire financing from 2008. The payment, along with a premium, is expected to reduce its fourth-quarter earnings by about 8 cents per share.
Target said it still wants to sell its credit-card receivables portfolio, but said it didn’t believe the time was right to complete a deal now.
“Our desire to sell the portfolio on appropriate terms remains the same today as it was when discussions began, but we believe that now is not the time to finalize a transaction,” said Doug Scovanner, executive VP and CFO, Target. “We believe a pause in discussions until later in 2012, combined with repayment of the Chase Card Services financing, will enable Target to reach an agreement with a high-quality financial partner on acceptable terms.”
In January 2011, Target announced plans to actively pursue a sale of its credit card receivables portfolio, and that if an appropriate transaction were to occur it would likely be achieved late in 2011 or early in 2012. The company now believes a transaction could occur in late 2012 or early 2013, about a year later than originally expected.
JCPenney picks another Apple alumnus for chief technology role
PLANO, Texas — Another former Apple executive has joined the ranks at JCPenney. The company announced Wednesday that Kristen Blum, a former director of supply chain and International retail for Apple Inc., has been named EVP and chief technology officer, effective Jan. 23.
Blum reports to COO Mike Kramer, and has responsibility for the company’s JCP.com business and information technology systems.
Kramer said, "The transformation underway at JCPenney relies heavily on having the best-performing, most effective technology to support our critical business functions and enhance our shopping experience. We are fortunate to have a solid technological infrastructure in place, and there is no one more talented or qualified in our industry to further develop and expand our capabilities than Kristen Blum. Having worked with her for many years, I have seen firsthand Kristen’s extraordinary ability to match strategic business objectives with technological solutions. We are thrilled to have her on board."
Blum was most recently SVP, chief information officer, enterprise transformation at PepsiCo. From 2006 to 2010, she was SVP, chief information officer at Abercrombie & Fitch, where she served on the CEO’s leadership team and was responsible for the strategic transformation of people, process and technology in support of international growth initiatives. Blum spent four years at Apple Inc. as director of supply chain solutions and international retail, overseeing technology supporting global operations and the development of systems supporting Apple retail. From 1999 to 2002, she was a senior manager at KPMG/Bearing Point, consulting for clients in the retail, consumer and high-tech industries. She has also held merchandising, planning and allocation roles at Planet Hollywood, Walt Disney and Victoria’s Secret.
Blum received a B.A. from The Ohio State University. She is a member of the National Retail Federation’s CIO Council and a Governing Body Member of the CIO Summit, among other leadership roles in CIO-focused organizations.
Report: Market speculates that Sears will go private
New York City — A report by Reuters on Tuesday revealed widespread Wall Street speculation that Sears Holdings Corp. may go private.
"There is a rumor that Bruce Berkowitz of Fairholme and Eddie Lampert could take Sears private," Jon Najarian, a co-founder of TradeMonster.com in Chicago, told Reuters.
Sears has not commented on the rumors, which come days after CIT Group halted loans that Sears’ suppliers use to finance the goods they sell to the Sears and Kmart chains.
The report, citing documents filed last Wednesday, said that CEO Eddie Lampert, who owns about 59% of the company, bought roughly $159 million worth of Sears shares from his ESL Investments hedge fund, representing 4.46 million shares in private sales. In addition, Lampert also bought shares on the open market for about $12 million.