J.C. Penney shares up after report of CEO search

NEW YORK Shares of J.C. Penney (JCP) shares jumped nearly 7 percent on Thursday on a media report that the retailer is starting a new CEO search to replace Mike Ullman.

Ullman, who had been J.C. Penney's CEO from 2004 to 2011, retook the reins in April after Penney CEO Ron Johnson was ousted after 17 months on the job after a radical makeover of the chain failed to boost results.

CNBC reported that the company is seeking a new CEO and that activist investor Bill Ackman sent a letter to J.C. Penney's board saying the process should be sped up. Former J.C. Penney CEO Allen Questrom, who ran the company from 2000 to 2004, said in an on-air interview on CNBC he would consider coming aboard as chairman under the right circumstances, if he agreed on the choice of CEO and as long as the board wasn't hostile.

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Ackman's Pershing Square had no immediate comment. Questrom and representatives for J.C. Penney could not immediately be reached.

Shares of Penney jumped 88 cents, or 6.9 percent, to $13.68 during midday trading. They are still close to the low end of the stock's 52-week range of $12.50 to $32.55.

Penney is trying to win back customers who fled during a transformation plan spearheaded by Johnson that backfired and led to massive losses and sales declines.

Penney amassed nearly a billion dollars in losses and its revenue dropped 25 percent for the fiscal year that ended Feb. 2 in the first year of the failed transformation strategy, which included decluttering stores, revamping merchandise and doing away with sales. Losses and sales drops continued into the first quarter, as the shadow of Johnson's legacy remained.

Ullman has been working to stabilize the business by bringing back basic merchandise and more frequent sales that were eliminated by Johnson in a bid to attract younger, hipper customers.

The report comes amid the back-to-school season that is the second-biggest shopping season for retailers behind Christmas. It also comes just ahead of Penney's second-quarter report, due out Aug. 20.