JC Penney tumbles as CEO Ellison leaves to join Lowe's

Shares in US department store operator JC Penney tumbled on Tuesday as it announced the resignation of chairman and chief executive officer Marvin Ellison, with immediate effect.

Ellison, who is leaving to become president and CEO of home improvement retailer Lowe's, will remain at the company until 1 June, after which a group of four directors will share responsibility for the day-to-day operations of the group until a new CEO is found.

Chairman Ronald Tysoe said: "I want to thank Marvin for his many significant contributions to JC Penney over the past three years. During his tenure, the company retired $1.4bn in debt, renewed and enhanced its revolving credit facility and has significantly strengthened the company's financial position.

"Additionally, he assembled a strong leadership team that will continue to serve the company in an elevated capacity to ensure the entire organization remains focused on our customer and improving results. We thank Marvin for his leadership and dedication, and wish him much success in his next endeavour."

While JC Penney shares slumped 8%, Lowe's was in the black as Ellison prepared to take over from Robert Niblock, whose intention to retire was announced back in March.

Marshall O. Larsen, lead director of the board at Lowe's, said: "Attracting Marvin is a great win for the entire Lowe's team. Marvin is an experienced retail CEO with extensive expertise in a complex omni-channel consumer-facing company. He also brings significant experience in the home improvement industry, with a proven track record of global operational excellence and driving results from both DIY and Pro customers.

"Marvin joins Lowe's at a critical inflection point as we work to enhance our competitive position and capitalise on solid project demand in an evolving consumer environment. We look forward to shepherding an exciting new chapter for Lowe's under Marvin's leadership."

Prior to his time at JC Penney, Ellison spent more than 12 years at Home Depot, where he served as executive vice president of US stores from 2008 to 2014 and was responsible for sales, profit and overall operations for 2,000 stores, more than 275,000 employees and $65bn in annual sales volume.

Before that, he held a variety of operational roles at Target over the course of 15 years.