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Apple executive takes full control as Penney CEO in February

JC Penney Chairman and CEO Ullman speaks during the meeting of the Wall Street Journal CEO Council in Washington
JC Penney Chairman and CEO Ullman speaks during the meeting of the Wall Street Journal CEO Council in Washington

NEW YORK (Reuters) - J.C. Penney Co Inc on Monday gave an exact date for completely handing over the reins of the department store chain to its next chief executive, Apple Inc's retail boss, saying he will take control on February 1.

Ron Johnson, who last week was tapped to be Penney's next CEO starting in November, will only take on merchandising and marketing responsibilities during a three-month transition.

Penney said that Johnson, who built Apple's stores into a successful chain of more than 300 in the last decade but has never held a CEO job, will take over the remaining responsibilities after the handover period.

Penney shares were up 90 cents or 2.6 percent at $35.19 on Monday afternoon.

Last week, when Penney made the announcement, the retailer said current CEO Myron Ullman would stay on as executive chairman and that Johnson would report to him. Shares rose 17.5 percent that day on hopes that Johnson's retail prowess would help speed Penney's turnaround.

But Penney gave no details on Ullman's involvement as executive chairman or his involvement in day to day operations, including managing Penney's retail operations and finances.

The Wall Street Journal reported over the weekend that Ullman, who has been CEO since 2004, would keep those responsibilities for an unknown period of time.

A transition, while unusual, makes sense given Johnson's inexperience as a CEO and the arrival of a new chief financial officer in January, one analyst said.

"They lost their CFO too and you need some continuity," said Morningstar analyst Paul Swinand.

Penney suffered dramatic sales declines during the recession as its shoppers, more exposed to the weak economy than those of rivals such as Macy's Inc, pulled back. Sales are recovering but are still well below 2008 levels.

(Reporting by Dhanya Skariachan and Phil Wahba; Editing by Lisa Von Ahn, Dave Zimmerman and Matthew Lewis)

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