Former second-in-command at US retailer JC Penney Co, who resigned from the company after being passed over for the top position, is joining rival Mervyn's as chairwoman.

Vanessa Castagna had had hoped to succeed Allen Questrom as chief executive of JC Penney when he quit last year, but the department-store chain instead picked Myron Ullman, former chief executive of retail chain Macy's.

Castagna formerly served as an executive at Wal-Mart Stores Inc.

Mervyn's operates about 250 stores in the USA and registered 2004 sales of $3.55 billion, about one-fifth the size of those of Penney.

Cerberus Capital Management, Sun Capital Partners, Lubert-Adler Management and Klaff Partners bought Mervyn's for $475 million from retail group Target last year.