SAN FRANCISCO -- Longtime Target ( TGT) Chief Executive Bob Ulrich, who helped transform the retailer into a hip discount giant, plans to step down.Ulrich, 64, will leave his post on May 1. He will be replaced by Target's president, Gregg Steinhafel, 52. Ulrich will remain as chairman through the end of the next fiscal year. Ulrich began his career as a merchandising trainee in 1967 at Dayton's, a former division of Target, and ultimately became chairman and CEO in 1994. Under his leadership, Target has nearly tripled its sales and its number of stores in the U.S. Ulrich also is credited for bringing in trendy designers such as Isaac Mizrahi and Michael Graves, who sold discount versions of their merchandise. The focus on chic items boosted the company's profile among young shoppers and helped make Target a formidable competitor to behemoth Wal-Mart ( WMT). "Ulrich, a longtime department store merchandising guy, was a real visionary in seeing what could make Target into a cost-competitive and desirable alternative to the industry's 300-pound gorilla, and he proved to be a very strong merchant and operator in bringing about that transformation over the last 20+ years," says Ed Weller, an analyst with ThinkEquity Partners. But Target has
Hedge fund Pershing Square Capital, run by activist manager Bill Ackman, has taken a nearly 10% stake in the retailer, pledging to enhance shareholder value. The company is currently evaluating -- reportedly under Ackman's pressure -- the sale of its lucrative credit card business. Weller doesn't believe that Ulrich's departure is tied to its recent bumps. "I don't think he's been pushed out, he's done a terrific job for a long time," he says. Steinhafel joined Target in 1979, serving in various merchandising positions until he became executive vice president of merchandising in 1994. He stepped up as president in 1999. "Our board and I have great confidence in Gregg as the next chief executive officer of Target," Ulrich said in a statement. "Gregg's considerable knowledge of our culture and history after 28 years with the company, his personal commitment in building a world-class team, and the innovations and energy he brings to Target everyday make him uniquely qualified to lead Target and drive its continued profitable growth in the current global retail environment."