Penney is giving up its two seats on Martha Stewart’s board of directors and Martha Stewart Living Omnimedia will “receive design fees, guaranteed minimum royalties and the 11 million shares of MSLO Class A Common Stock that JCPenney currently owns.”
That sounds like the 11 million shares, worth nearly $25 million at today’s closing price, are a payment for cancelling most of the contract terms between the two companies. Penney’s invested $38.5 million in Martha Stewart Living Omnimedia as part of the original deal.
Penney and Martha Stewart fell afoul of an earlier deal the lifestyle company had made with Macy’s Inc. (NYSE: M). Macy’s sued and a ruling is due later this week. Monday’s agreement is likely an effort by Penney and Stewart to resolve the dispute among the three companies before the ruling is made. A Macy’s spokesman cited in The Wall Street Journal claimed “victory” and said that the “announcement was a tacit admission by both companies that their agreement violated Macy’s exclusive contract to sell Martha Stewart bed, bath and kitchen goods products.”
Penney and Martha Stewart are left with an agreement under which the lifestyle company will continue to design Martha Stewart branded products in window treatments and hardware, lighting, rugs, holiday and celebrations for Penney.
Penney’s stock closed Monday’s after hours trading session at $6.40 after setting a new multi-decade low of $6.27 earlier in the day.
Take Charge of Your Retirement In Just A Few Minutes (Sponsor)
Retirement planning doesn’t have to feel overwhelming. The key is finding expert guidance—and SmartAsset’s simple quiz makes it easier than ever for you to connect with a vetted financial advisor.
Here’s how it works:
- Answer a Few Simple Questions. Tell us a bit about your goals and preferences—it only takes a few minutes!
- Get Matched with Vetted Advisors Our smart tool matches you with up to three pre-screened, vetted advisors who serve your area and are held to a fiduciary standard to act in your best interests. Click here to begin
- Choose Your Fit Review their profiles, schedule an introductory call (or meet in person), and select the advisor who feel is right for you.
Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
Our expert who first called NVIDIA in 2009 is predicting 2025 will see a historic AI breakthrough.
You can follow him investing $500,000 of his own money on our top AI stocks for free.