Kohl's under pressure to sell or change e-commerce business

Kohl's (NYSE: KSS) is under pressure from activist investor Engine Capital to sell or spin off its e-commerce business. Engine holds around a 1% stake in the Wisconsin-based department store chain, although Kohl's has several other activists on its cap table.

Why it matters: Omnichannel is falling out of favor among some department store investors, with Kohl's being asked to follow the recent examples of Saks Fifth Avenue and Macy's. The basic argument is that shareholders can get more defined access to the faster-grown business, and the legacy companies more cash to transform their physical properties.

Primary sources: Read Engine Capital's letter, which argues Kohl's e-commerce business could be worth $12.4 billion as a stand-alone. Kohl's has a current market cap of $7.3 billion and an $11.6 billion enterprise value.

• Kohl's issued the following statement: "The Kohl’s board and management team continuously examine all opportunities for maximizing shareholder value. Our strong performance this year demonstrates that our strategy is gaining traction and driving results. We appreciate the ongoing dialogue we are having with our shareholders and value their input and perspectives."

The bottom line: Sayonara synergy.