RETAIL : Chairman Duties Are Taken From Kmart’s Antonini

Setting the stage for the possibility of more significant changes, Kmart Corp. on Tuesday stripped Joseph Antonini of his duties as chairman but retained him as president and chief executive of the struggling retail chain.

The company said Kmart board member Donald S. Perkins, who chaired the Jewel Cos. supermarket chain before retiring in 1980, was elected to replace Antonini as chairman. The board said it believes the change “provides Kmart with the team it needs to improve shareholder value.”

Although the change is designed to deflect criticism leveled by Kmart investors dissatisfied with sagging profit, many industry analysts believe the move is largely symbolic because Perkins will be a non-executive chairman with no offices at Kmart, while Antonini continues to oversee the company’s daily operations.

On the other hand, Kmart also announced Tuesday that it is launching a strategic review of top-level matters, such as merchandising, financial policies and general leadership--issues critical to many company shareholders. Many analysts believe that such a review could pave the way for major changes at the company, including the removal of Antonini should he fail to engineer major improvements in earnings and store operations.

“Perkins and the board are now in position to take the bull by the horns,” said Walter Loeb, a New York-based retail analyst. “This sets the stage, but the strategic review can give the board a rationale for making major changes.”

Commenting on the changes during a news conference at Kmart’s Troy, Mich., headquarters, director F. James McDonald said Perkins will help the company find and recruit top-level managers.

While the company is looking for managers who can upgrade store operations, that quest could eventually become a search for a new chief executive, said Kurt Barnard, a New Jersey-based retail economist.

“The company simply has not found anyone who can replace Antonini,” Barnard said. “I think the board is now looking for change--or the promise of change--within a year. And Antonini will have to respond.”

Antonini, who has headed Kmart since 1987, has been the target of shareholder criticism because the discount retail chain has failed to make sales gains against rival Wal-Mart Stores Inc. Critics say Antonini was too slow to divest the company’s specialty units--a process now under way--and that he has failed to make the core business more competitive.

Kmart had a net income of $151 million for the 39-week period ended Nov. 14, compared to earnings of $219 million for the same period in 1993. The company operates about 4,000 discount chain stores, including 73 in Southern California and 219 statewide.

Kmart stock closed up 25 cents at $13.50 on the New York Stock Exchange.