Vornado’s Roth may lose Penney board seat over ousting of retailer’s CEO

May 10, 2013 11:00AM

Vornado Realty Trust chairman Steven Roth could be ousted from the board of J.C. Penney for playing a role in recruiting the retailer’s ousted CEO Ron Johnson, the Wall Street Journal reported.

A proxy firm is advising that J.C. Penney investors remove Roth, a director who serves on the board’s corporate governance committee. Egan-Jones Proxy Services did not comment to the Journal on Roth’s connection to the recruitment.

Committees “should be comprised solely of independent outside directors for sound corporate governance practice,” the firm said in its report.

Last month, the board ousted Johnson and replaced him with his predecessor Myron Ullman. Last year proved disastrous for the retailer, as sales fell 25 percent and the stock price plummeted 50 percent. Nevertheless, J.C. Penney has held a large amount of prime real estate at an extremely low cost, due to its advantageous leases.

Roth is one of the retailer’s biggest shareholders. He owns about 5 percent of Vornado’s shares and, as of March 31, Vornado had a 6.1 percent stake in J.C. Penney. [WSJ]  Mark Maurer