Kohl’s Corp said on Thursday that interim chief executive officer Tom Kingsbury, a director nominated by hedge funds Macellum Advisors and Ancora Holdings, will take over the role on a permanent basis.

Kingsbury has been serving as an interim chief since December, after CEO Michelle Gass left Kohl’s for jeans maker Levi Strauss & Co.

In connection with Kingsbury’s appointment as top boss, Kohl’s has also entered into a cooperation agreement with Macellum and some of its affiliates, with the hedge fund agreeing to multi-year standstill, voting and other provisions.

“We are very excited about the future of Kohl’s under the leadership of Tom and have the utmost confidence in his ability to maximise shareholder value,” said Jonathan Duskin, managing member of Macellum.

Kohl’s, which caters more to lower-income customers compared with rivals like Macy’s Inc and Nordstrom Inc , withdrew its annual sales and profit forecasts late last year, as the company reels from weakening demand from inflation-wary shoppers.

The drop in sales and an unsuccessful attempt to sell itself last year gave activist investors, including Macellum and Ancora, more ammunition to pressure Kohl’s to cash out on assets and return money to shareholders.

However, the company has so far been reluctant to meet some of the activists’ demands, including the sale and lease-back of its real estate, arguing that it would hurt the financial health of the company.

Kingsbury has been on Kohl’s board since 2021. He was previously the CEO of off-price chain Burlington Stores Inc.

Kohl’s shares, which are down about 41 percent in the last 12 months, have gained 18% since the announcement of Kingsbury’s appointment as interim CEO in November.

By Deborah Sophia and Uday Sampath; Editor: Shailesh Kuber

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