Ackman puts JC Penney stake up for sale Bill Ackman has put his stake in JC Penney up for sale as the hedge fund manager prepares to end three years as the biggest shareholder in the department store where he has lost at least 40 per cent of his original investment. Mr Ackman's Pershing Square hedge fund will sell its 17.7 per cent stake via Citigroup, which will act as bookrunner, as the mid-market retailer struggles to recover from the impact of a chief executive Mr Ackman installed. In a letter to investors in his fund this month, Mr Ackman said that as of August 16 JC Penney "stock trades at a more than 40 per cent discount to our average cost" of investment. Given that Mr Ackman holds 39m shares and the stock closed at $13.40 on August 16, that suggests he is carrying a paper loss of at least $349m. It is not known at what price he will be able to offload the shares. The hedge fund manager played a central role in hiring Ron Johnson from Apple to revive the tired chain, but Mr Johnson's strategy alienated shoppers and triggered a disastrous fall in sales. He left the job in April after 17 months. JC Penney shares closed at $13.35 on Monday, then fell 1.8 per cent to $13.11 in after-market trading after Mr Ackman's share sale was announced. In the letter to investors this month, Mr Ackman acknowledged that his JC Penney investment had been a "failure." But in recent weeks he has sought to portray the hiring of Mr Johnson as a move that all JC Penney directors wanted. Mr Ackman resigned from JC Penney's board earlier this month after an unusually public spat with fellow directors. It was sparked by the hedge fund manager's unhappiness over the performance of Mike Ullman, who was brought back as chief executive in April to replace Mr Johnson having stepped down in 2011 to make way for him. JC Penney, which has over 1,000 stores mostly in regional malls, will not receive any proceeds from Mr Ackman's share sale, it said. As underwriter, Citi will purchase the shares from Mr Ackman and offer them for sale "from time to time . . . in one or more transactions or otherwise," according to a JC Penney regulatory filing. Last week JC Penney reported another quarterly loss and plunging sales. The retailer said its like-for-like sales in the three months to August 3 fell 11.9 per cent as it reported a net loss of $586m. Mr Ullman, who has reintroduced popular discounts and brands that Mr Johnson had scrapped, said he had made "meaningful progress" in stabilising the business. But he added: "There are no quick fixes to correct the errors of the past."