UPDATE 1-Clinton Group says no longer seeking sale of Wet Seal
* Clinton Group seeks turnaround, wants new CEO
* Company appoints Clinton nominee as chairman of board
(Rewrites throughout, adds Clinton Group comments, bullets, details)
By Chris Peters
Oct 10 (Reuters) - Activist investor Clinton Group said it will no longer push for a sale of Wet Seal Inc , which it won control of last week, but will instead focus on turning the apparel retailer around.
On Friday, the investment firm managed to get four of its nominees elected to Wet Seal's eight-member board. One seat has been left vacant. Wet Seal also named a Clinton Group nominee as chairman on Wednesday.
Clinton Group, which in June called for a sale of the retailer, said it is now hoping for a turnaround under the new board.
Wet Seal, which has been hit by a continuous decline in monthly same-store sales, should focus on hiring a top-notch chief executive and turning itself around before considering a sale, Clinton's managing director Greg Taxin said.
The retailer, which caters primarily to young women, fired CEO Susan McGalla in July as Clinton stepped up pressure to turn around the business.
"When the company fired its CEO without a replacement available and no clear strategic direction ... they needed to consider whether selling itself would be the best option," Taxin told Reuters on Tuesday.
Lynn Davey, Wet Seal's new chairman, was previously chairman and chief executive of Avalon Group Ltd, and will replace Harold Kahn, who resigned following the Clinton Group's efforts to bring changes to the board.
Shares of the Foothill Ranch, California-based company were up 2 percent at $3.10 on the Nasdaq on Wednesday morning.
(Reporting By Chris Peters and Maria Ajit Thomas in Bangalore; Editing by Saumyadeb Chakrabarty and Sreejiraj Eluvangal)
Keywords: WETSEAL CLINTONGROUP/