Business

Ackman abandons push to oust Ullman from JCPenney

Bill Ackman has blinked in his battle with JCPenney’s board.

The New York hedge-fund tycoon has abandoned his aggressive push to quickly replace the struggling department-store chain’s CEO, Mike Ullman, sources told The Post.

It wasn’t immediately clear under what conditions Ackman, Penney’s largest shareholder, will concede defeat after more than a week of public sparring with Ullman and the retailer’s other board members.

A source said, however, that Ackman will likely remain on the board and has no immediate plans to carry out a recent threat to sell his 18-percent stake in the company.

A source said a “resolution” to the flare-up between Ackman and Penney’s board could come as soon as today.

News of the truce was first reported this afternoon on nypost.com.

In exchange for giving up on a demand that Ullman be replaced within the next 30 to 45 days, sources said Ackman will likely seek regular updates on the company’s business.

“The old joke is that if you’re the only dissident on the board, all the decisions get made when you go to the bathroom,” says David Rosewater, a partner at law firm Schulte Roth & Zabel.

Also, Ackman has likely demanded commitments on cost controls — particularly inventory.

Ackman “is worried that Ullman has been going crazy on inventory [buying],” according to a source briefed on the situation.

Penney, meanwhile, will proceed with a more deliberately paced CEO search, for which it has hired headhunting firm Heidrick & Struggles, sources said.

“It’s going to be the Mike Ullman show for the fall and holiday season at least,” according to a source.

Ackman and Penney didn’t respond to requests for comment.

Ullman, who had served as Penney’s CEO for seven years until 2011, returned to the helm in April to repair damage done in a disastrous turnaround effort led by former CEO Ron Johnson.

Last week, Ackman stirred a hornet’s nest as he went public with two fiery letters to Penney’s board, accusing it of dithering while the company’s cash dwindles.

Ackman said he has “lost confidence” in Penney Chairman Thomas Engibous, adding that he wants to replace him with Allen Questrom, the legendary merchant who led Penney out of a crisis a decade ago.

Engibous returned fire, backing Ullman and calling Ackman’s letters “counterproductive.”

The chairman noted that it was Ackman who had spearheaded the hire of Johnson, a former Apple exec whose strategy to eliminate coupons and sales events spurred a $1 billion loss last year and sent sales tumbling 25 percent.

As reported by The Post, sources said Penney’s board last month kicked Ackman out of a meeting after he demanded that Ullman be replaced by the time second-quarter earnings were released on Aug. 20.

jcovert@nypost.com