By Suzanne Kapner and Sarah Nassauer

Kohl's fired chief executive Ashley Buchanan after it discovered he had instructed the retailer to enter into a "highly unusual" business deal involving a woman with whom he has had a romantic relationship, according to people familiar with the situation.

Buchanan met the woman, Chandra Holt, when they were both working at Walmart several years ago, the people said. Buchanan went on to run crafts chain Michaels and took over as Kohl's CEO in November. Holt went on to become the CEO of Bed Bath & Beyond. She is now a consultant and the founder of Incredibrew, a coffee brand infused with vitamins and minerals.

Buchanan declined to comment. "I've known Ashley Buchanan for 10 years, but I have not received any compensation for my Incredibrew business from Kohl's," Holt told The Wall Street Journal.

A Kohl's board investigation found that Buchanan violated the company's code of conduct in two instances with a vendor with whom he had a personal relationship and whom it didn't name, according to a regulatory filing.

The filing said he directed the retailer to conduct business with this vendor and he caused the company to enter into a multimillion-dollar consulting agreement, where that person was part of the consulting team.

Kohl's said Buchanan didn't disclose the relationship as required by its code of ethics and determined the conduct in both cases constituted cause for termination. Buchanan will forfeit all equity awards from Kohl's and be required to reimburse the company on a prorated basis a signing bonus worth $2.5 million.

The two retail veterans have known each other for years. Buchanan was the Sam's Club chief merchandising officer and Holt held several positions at the Walmart chain, including general merchandise manager of grocery and the chief operating officer of its website.

They both further rose through the ranks at Walmart before leaving around the same time for other positions at Texas-based retailers. Buchanan left in early 2020 to become CEO of Michaels.

Holt left in 2021 to become CEO of Conn's HomePlus and later Bed Bath & Beyond. She is currently an adviser at Boston Consulting Group, according to her LinkedIn profile.

On Thursday, Kohl's appointed Chairman Michael Bender as its interim CEO. He becomes the fourth CEO in three years at the department-store chain, which has been struggling with slumping sales. The company on Thursday said that sales likely declined by around 4% in its most recent quarter and that it expected to post another loss when it reports results later this month.

In an all-hands meeting on Thursday, Bender and other Kohl's executives sought to reassure staffers about the abrupt leadership change. They didn't provide details beyond the company's public statements or take questions in the meeting.

"Ashley has been terminated from his role and he will also no longer serve on the Kohl's board," Bender said, according to a recording reviewed by the Journal. "This is not a moment we expected nor the outcome we wanted for the company and our associates, but it is the right decision for us."

Write to Suzanne Kapner at suzanne.kapner@wsj.com and Sarah Nassauer at Sarah.Nassauer@wsj.com

(END) Dow Jones Newswires

May 01, 2025 13:15 ET (17:15 GMT)

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