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 itwill no longer push for a sale of Wet Seal Inc , whichit won control of last week, but will instead focus on turningthe apparel retailer around.

On Friday, the investment firm managed to get four of itsnominees elected to Wet Seal's eight-member board. One seat hasbeen left vacant. Wet Seal also named a Clinton Group nominee aschairman on Wednesday.

Clinton Group, which in June called for a sale of theretailer, said it is now hoping for a turnaround under the newboard.

Wet Seal, which has been hit by a continuous decline inmonthly same-store sales, should focus on hiring a top-notchchief executive and turning itself around before considering asale, Clinton's managing director Greg Taxin said.

The retailer, which caters primarily to young women, firedCEO Susan McGalla in July as Clinton stepped up pressure to turnaround the business.

"When the company fired its CEO without a replacementavailable and no clear strategic direction ... they needed toconsider whether selling itself would be the best option," Taxintold Reuters on Tuesday.

Lynn Davey, Wet Seal's new chairman, was previously chairmanand chief executive of Avalon Group Ltd, and will replace HaroldKahn, who resigned following the Clinton Group's efforts tobring changes to the board.

Shares of the Foothill Ranch, California-based company wereup 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)

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