The Wall Street Journal -- February 6, 1996

Calpers Highlights Retailers in Its List Of `Underperformers'
 

 SACRAMENTO, Calif. -- Retailers dominate this year's list of "financial underperformers" compiled by the California Public Employees' Retirement System, or Calpers.

 The nation's largest public-employee pension fund has issued target lists of underachievers in its stock portfolio for the past nine years in a move to pressure companies to boost shareholder value. Calpers, which bases its list on the companies' relative rates of shareholder return, usually demands meetings with company managements and is known to flex its muscle to oust directors when rebuffed.

 This year's list includes five retailers: Charming Shoppes Inc., Edison Brothers Stores Inc., Melville Corp., Stride Rite Corp. and Venture Stores. Also making the roster was Bassett Furniture Industries Inc., a furniture maker.

 Melville, based in Rye, N.Y., is one of two repeat performers on the list. As previously reported, the chain is spinning off its toy and footwear stores and focusing on drugstores. The other company reappearing from last year is Dallas- based Oryx Energy Co. Rounding out the list were: Applied Bioscience International Inc., which provides drug-safety testing and other laboratory services; Rollins Environmental Services, a waste-disposal and treatment company; and U.S. Surgical Corp., a medical-products concern.

 Stride Rite, which has come under Calpers's scrutiny for its staggered board terms, said it has met with the pension fund and believes it has "the appropriate structure for its board." Charming Shoppes said it plans to meet with Calpers and is taking steps to boost shareholder value. A Rollins spokesman said the company is working to cut expenses and increase sales. The other companies either declined to comment or couldn't be reached.

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