Jane Elfers, CEO at the Children’s Place for the past 14 years, has resigned.

The board of directors has initiated a search for a permanent CEO but in the meantime, Muhammad Umair will serve as interim chief.

Umair joined the board in February after Mithaq Capital bought a majority stake in the company.

According to a filing with the US Securities and Exchange Commission and a corporate announcement, Elfers left the specialty retailer last month by “mutual agreement”.

Elfers will receive $3.75 million as part of her separation agreement, while Umair is set to receive a $650,000 annual base salary.

The leadership transition comes shortly after The Children’s Place announced its full-year performance, where net sales fell 6.2 per cent to $1.6 billion, down from about $1.7 billion the year prior. 

“The Children’s Place and our portfolio of brands have a strong connection to our customers, and I look forward to leveraging the many opportunities ahead in the children’s apparel retail segment,” said Umair in a statement. 

“My focus will be to foster growth through innovation, deliver exceptional value to our customers and drive returns for shareholders.”

The chairman and CEO of Mithaq, Turki AlRajhi, who is also chairman of The Children’s Place, wrote a letter to shareholders outlining how he wants to reshape the company’s capital allocation and operations – including prioritizing repayment of The Children’s Place’s debt.

“We do not want to leave [The Children’s Place] at the mercy and kindness of lenders who are not aligned with [The Children’s Place’s] shareholders,” said AlRajhi.

“We want management to focus on long-sighted decisions and long-term value creation, not on short-sighted decisions and behaviors to meet or beat quarter-to-quarter earnings guidance.”