JCPenney names Jill Soltau as its new CEO

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The company announced on Tuesday that Soltau will take over as its chief executive beginning on October 15. JCPenney has been leaderless since Marvin Ellison left in May to take the top job at Lowe’s.

Soltau, 51, will be the 25th woman currently leading a Fortune 500 company, according to Fortune magazine. She will become Penney’s fifth chief executive in the past decade.

She will make a base salary of $1.4 million, with a $6 million signing bonus and will be eligible for annual performance-based bonuses.

In a sign that Soltau has Wall Street’s approval to start, shares rose 10% in extended trading.

Soltau will face a daunting task: turning around JCPenney (JCP), a former retail heavyweight that has fallen more than 50% this year and slipped to close to $1.50 a share. Penney is currently without its chief financial officer. Jeffrey Davis resigned last week only 14 months after taking the job.
The challenges at JCPenney are enormous. It is more than $4 billion in debt and has posted a profit in only two quarters during the past four years. Penney lost $101 million in its most recent quarter.
JCPenney’s decline comes at a moment when rival department stores Nordstrom (JWN), Kohl’s (KSS) and Macy’s (M) have demonstrated an ability to reinvent their businesses for the digital shopping era.

Soltau will have to make tough decisions about Penney’s store footprint. The company has 860 stores and hundreds of them are in struggling malls. JCPenney also has a glut of clothing piling up at its warehouses and stores.

Penney has been searching for a leader with merchandising experience to help it make better decisions about which brands to sell in stores.

“We wanted someone with rich apparel and merchandising experience and found Jill to be an ideal fit,” board director Paul Brown said in a news release.

Soltau took over at Joann in 2015. She has also held positions at Shopko, Sears, and Kohl’s.

Penney selecting Soltau signals the company wants to break from Ellison’s strategy.

Ellison was a former Home Depot executive and led Penney into the appliance business. But his tenure had mixed results: Washers and dryers were not major draws for customers and its clothing assortment suffered.

Penney believes its core shoppers are middle-aged women. Earlier this month, Penney introduced Artesia, a new women’s chic brand for less than $30.

CNNMoney’s Julia Carpenter contributed to this story.

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