The news comes a day after the Minneapolis-based company said it would nominate for re-election all four of its current directors whose terms are expiring this year, and said it was "disappointed" that activist hedge fund manager William Ackman - who owns a nearly 8 percent stake in the company - planned to nominate his own slate.
Ackman, the founder and chief executive of Pershing Square Capital Management LP, has said in the past that he believes Target's stock is undervalued. The shares have fallen as much as nearly 60 percent since hitting a 52-week high of $59.55 in September. The company has suffered from a drop in consumer spending, while other discount chains - particularly rival Wal-Mart Stores Inc. - have outperformed the market.
Target said Monday that it considered nominating Ackman and one other individual suggested by Pershing Square to its board, but "after careful consideration" the company decided against it.
Ackman said in a statement Tuesday that the nominees "will bring insight, accountability and fresh and relevant perspectives to the Target board." Aside from Ackman, nominees include Winthrop Realty Trust Chairman and Chief Executive Michael L. Ashner; former Starbucks Corp. Chief Executive Jim Donald; law professor Ronald L. Gilson and former First USA Chief Executive Richard W. Vague.
"We are disappointed that Pershing Square has decided to pursue a costly and disruptive proxy contest, especially in light of our previous dialogue," Target said in a statement on Monday.
Target plans to nominate for re-election Mary N. Dillon, global chief marketing officer at McDonald's Corp.; Richard M. Kovacevich, chairman of Wells Fargo & Co.; George W. Tamke, partner at Clayton, Dubilier & Rice Inc.; and Solomon D. Trujillo, CEO of Telstra Corp.
Target's board is comprised of 13 members.
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