Discount retailer Target Corp. knows a thing or two about
selling stylish affordable products through its own credit card. In its latest
earnings period, the retailer's credit card unit's pretax earnings rose 34%
compared to a year ago. But, according to a report from TheStreet.com, Target
is willing to part ways with its credit card unit as well as real estate
assets to boost earnings. A deal could be made as soon as the end of
September. The move seems a bit short-sighted considering the strength of its
credit card business. But a shift in strategy could be attributed to pressure
from activist shareholder William Ackman through his Pershing Square Capital,
which recently picked up a 9.6% ownership stake in Target. Ackman has been
quoted as saying that he is prepared to discuss ways of increasing shareholder
value. BizJournal reported that Pershing had pressured business services
company Ceridian Corp. to recently spin off its Comdata unit to increase
shareholder value. —Gerald Magpily
See
TheStreet.com article
See
TheDeal.com article
Tags:
Target,
auction block,
Pershing Square,
m&a
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