Express CEO Weiss Passing Job to Company’s PresidentLindsey Rupp
Express Inc. Chief Executive Officer Michael Weiss, who has run the business since it was an eight-store experiment by Limited Brands in 1980, is passing the reins to President David Kornberg next year.
Weiss will stay on as nonexecutive chairman after Kornberg takes the CEO job on Jan. 30, the Columbus, Ohio-based company said yesterday in a statement. Weiss, 73, had previously retired in 2004, though he returned in 2007 when the business was acquired by Golden Gate Capital Corp.
The management change comes at the same time as a possible takeover fight. After amassing a 9.9 percent stake in Express, private-equity firm Sycamore Partners said last month that it would like to perform due diligence to determine an acquisition price. Express responded by adopting a poison-pill defense, though it said the move wouldn’t prevent it from considering or accepting a friendly offer.
“Their best option is to go private again,” said Susan Anderson, an Arlington, Virginia-based analyst at FBR & Co. Sycamore could pay as much as $24 a share for Express, according to Anderson, who said a deal is likely to get done.
Both Weiss and Kornberg worked with Sycamore’s executives when they were at Golden Gate Capital, Express’s previous private-equity owner, said Anderson, who has a market-perform rating on the stock, the equivalent of a hold.
Kornberg, a former Marks & Spencer Plc executive who joined Express in 1999, became president in 2012.
“I will be leaving Express in the hands of a deep and talented management team,” Weiss said in the statement.
Express shares rose 0.1 percent to $16.01 at the close of trading in New York. The stock has declined 14 percent so far this year.
Weiss’s retirement “is not happening in connection with Sycamore’s indication of interest in the company,” Marisa Jacobs, a spokeswoman for the company, said in an interview. Express expects the management transition to be seamless, she said.
Weiss has been trying to boost results at the apparel retailer by relying more on factory stores and eliminating unsold inventory. Still, analysts see sales and earnings continuing to slide for at least two more quarters.
The retailer cut its annual profit forecast in May to as much as 90 cents a share, from as much as $1.23. Express is wrestling with deep discounts across the retail industry and low traffic at U.S. malls, where the chain does much of its business. The company also said in May that it plans to close about 50 stores during the next three years, out of more than 600 retail and factory outlet locations.