Nov 8, 2022
Levi Strauss & Co. appoints Michelle Gass as president
Nov 8, 2022
Levi Strauss & Co. on Tuesday named current Kohl's Corp chief executive officer Michelle Gass as the next CEO of the denim maker, succeeding long-time head Chip Bergh.
Gass' departure from the struggling department store chain comes as activist investor groups push for management and board reshuffles, including a change of CEO.
Hedge funds Macellum Advisors and Ancora Holdings spearheaded a new round of shareholder unrest for Kohl's after the company explored a sale and decided in July to remain independent, leading to a plunge in its shares and disappointing investors who had pushed for a deal.
While, Levi's does not face the same activist pressure as Kohl's, its earnings have still taken a hit from softening demand and Gass will need to navigate the company out of an inflationary environment that has caused a slump in discretionary spending.
"While it is true that Gass has presided over the decline of recent years, she has also been responsible for guiding Kohl's through the challenging pandemic period and putting in place improvements in assortments, multichannel and store format development," Neil Saunders, managing director at research firm GlobalData, said.
Gass will leave Kohl's in December to become president of Levi's early next year, and will take over as chief executive within the next 18 months.
As part of Levi's succession plan, Gass will initially report to Bergh, who has led Levi's for the last 11 years and was involved in the company's return to public markets in 2019.
Kohl's said Tom Kingsbury, a director who was nominated by Macellum and Ancora last year, will serve as interim CEO from December 2.
Peter Boneparth, the board's chair said, “Tom is highly regarded and perfectly equipped to take the role of Interim CEO, and the board looks forward to working closely with him and the team to facilitate a smooth transition process and continue driving Kohl’s strategy.”
Kohl's forecast third-quarter earnings of 82 cents per share, compared with analysts' estimates of 64 cents, according to Refintiv IBES data. The department store chain's shares rose 6.5%.
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