(Adds comparison with rival, share movement)
By Siddharth Cavale
Jan 19 (Reuters) - Home improvement chain Lowe’s Cos Inc appointed two independent board members and plans to add a third following talks with activist hedge fund D.E. Shaw & Co, sending its shares up 2 percent premarket.
The appointments follow a report last week that D.E. Shaw had built an active stake in the $84 billion company and was concerned about its performance in comparison with peers.
D.E. Shaw has not publicly commented about its stake or its plans for the retailer. It was not immediately available for a comment.
The CNBC report cited sources saying that the hedge fund was not planning to push for consolidation with another home retailer at this time.
Lowe’s same-store sales growth has lagged Home Depot’s for several years as the company focuses more on do-it-yourself customers compared with its bigger rival’s focus on professional contractors who bill more.
Although Lowe’s stock gained 30 percent last year, it underperformed Home Depot’s 41 percent rise.
Lowe’s said on Friday David Batchelder, co-founder of Relational Investors, and Lisa Wardell, CEO of Adtalem Global Education, will join the board.
The retailer, which said it had held “constructive discussions” with the hedge fund, will also nominate Brian Rogers, chairman of T. Rowe Price Group and its former chief investment officer, for board election.
Batchelder was recommended by D.E. Shaw, while Wardell and Rogers were the company’s candidates, a source close to the matter said.
The appointments of Batchelder, who will serve on the board’s compensation committee, and Wardell, who will sit on the audit committee, are effective March 22. (Additional reporting by Vibhuti Sharma in Bengaluru; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)