Advisory Firms Split On Target, Ackman Proposals

Egan-Jones Proxy Services said Thursday that shareholders should keep the board at 12 members, and it recommended all but two of the company's nominees. It said Ackman's firm's stake in the company creates "an incentive to favor risk-taking to affect short-term share performance."

Pershing Square owns nearly 8 percent of Target's outstanding stock, making it one of the discounter's largest shareholders.

In a news release Friday, Ackman commended Proxy Governance's recommendations to boost the size of the board and elect Winthrop Realty Trust Chairman and CEO Michael Ashner and former Starbucks Corp. CEO Jim Donald, who helped build Wal-Mart's super centers and has experience in the food business.

On Thursday, Target once again urged its shareholders in a letter to vote against Ackman's slate, saying Ackman is motivated by a risky short-term agenda. It said it was disappointed in Proxy Governance's recommendations.

Proxy Governance said that although the current board has helped Target grow in the past dozen years, the future is at stake.

"Whether the company could have positioned itself better for future success, however, is a different question entirely," the report said.