KMART HUNTS FOR ADAPTABLE CEO

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Kmart Corp. is looking for a leader who can sail the ship without dumping the crew.

Before Joseph Antonini's resignation in March, the struggling retailer spent more than six months putting in a new management team and beginning an attempted turnaround. Now, some analysts believe Troy, Mich.-based Kmart wants a leader with less shake and more roll.

"Kmart might take the IBM or Kodak approach to bring in a very strong leader that is not going to further disrupt the organization," said Frederick Marx, president, Marx Layne & Co., a Farmington Hills, Mich., consultancy. "Most of the people left at Kmart are conditioned to change."

In anticipation of Kmart's annual shareholders meeting on May 23, several reports surfaced about Mr. Antonini's successor.

Last week The Wall Street Journal reported that Kmart board nominee Richard Cline, chairman and former CEO of Naperville, Ill.-based Nicor Inc., had been offered the Kmart CEO position.

Mr. Cline, 60, might be someone who could come in and groom Ron Floto, exec VP of Super Kmart Centers, to eventually take over Kmart. Mr. Cline and Mr. Floto have close ties to Chairman Donald Perkins, all of whom once worked for Chicago-based Jewel Cos.

The surfacing of Mr. Cline's name raises speculation Kmart might want someone to mentor Mr. Floto and someone from outside retailing who might not be as inclined to shake up the current management team.

Campbell Mithun Esty, Minneapolis, handles the $175 million Kmart account.

Outside candidates believed to be in the running include: Kenneth Macke, former chairman-CEO of Dayton Hudson Corp.; Michael Bozic, president-CEO of Hills Stores Co.; William Fields, VP-merchandising and sales at Wal-Mart Stores.

Internal candidates include: Mr. Floto; Marvin Rich, exec VP-strategic planning, finance and administration; Ken Watson, exec VP-marketing and product development; Charles Chinni, exec VP-merchandising.

Last week, Kmart posted a first-quarter loss of $28 million, compared with an $18 million profit a year earlier. Sales rose 8.1% to $7.8 billion.

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