Dive Brief:
- Arts and crafts retailer Joann has appointed Michael Prendergast interim CEO. Prendergast is a managing director with Alvarez & Marsal Consumer and Retail Group who has over 20 years of retail transformation leadership experience, the company said Friday. A search for a permanent CEO is underway.
- Chief Customer Officer Chris DiTullio and Chief Financial Officer Scott Sekella, who served as interim co-leads of Joann’s office of CEO for about a year, including through the company’s recent Chapter 11 bankruptcy, will stay with the retailer and continue with their respective roles.
- Joann also announced on Friday the appointment of a new five-member board of directors to lead the company.
Dive Insight:
At the height of the pandemic, Joann said it saw a business surge as people stuck inside under stay at home orders took up sewing and crafting. But as a new normal emerged, Joann’s performance slid. Chapter 11 enabled Joann to cut its $1 billion-plus debt load in half. The company said it avoided any store closures or layoffs, leaving its 800-plus store footprint and 18,000 person employee roster intact.
The retailer filed for bankruptcy on March 18 and exited the process about six weeks later in late April as a privately held company owned by its creditors.
Prior to bankruptcy, Joann was losing share to rivals like Amazon, Hobby Lobby and Michaels, according to Neil Saunders, managing director of GlobalData, “Joann needs to be more competitively aggressive to take back share,” Saunders said in emailed comments. “Given it has not closed stores during bankruptcy, it still has the reach to make an impact.”
Joann said the new board members bring deep experience and valuable guidance to the company’s senior leadership team. “We are honored to join what is truly a new Joann, and we look forward to supporting the company and its leadership team in its mission to inspire creativity,” interim board chairman Darrell Horn said in a statement.
Horn holds a strategic adviser role with Green Square Wealth Management. He’s also a co-founder of Center Coast Capital Advisors, a Texas-based energy investment management firm. He previously held positions at Goldman Sachs, SunTrust and First American Bank.
The other new board members include:
- Mary Campbell, who has served on the Kontoor Brands board since February. She previously held multiple leadership roles at Qurate Retail Group, including president of v-commerce before retiring in 2023.
- Joe Hartsig, who is a managing director at advisory firm Raines International where he leads the retail and business services practices. He held senior leadership roles at Bed Bath & Beyond, Walmart and Walgreens.
- Michelle Israel, who joined investment bank Consensus Advisors as a strategic adviser in 2023 after holding leadership roles at Macy’s and Bloomingdale’s. Those roles included leading Macy’s off-price growth strategy, building out the Bloomingdale’s Outlets business and opening nearly 175 Macy’s Backstage outlets.
- Bill Wall, who focuses on identifying distressed investment opportunities for Fidelity’s high income and alternatives group. He was a founding partner at hedge fund Andover Capital. Wall began his career as an associate at Ropes & Gray, providing legal advice on private equity and corporate finance at the multinational law firm.
