Sycamore Partners is reportedly the leader in an auction for J.C. Penney— and if the bid is successful, the private equity firm will merge the department store retailer with Belk, according to published reports.
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J.C. Penney has decided to close its Manhattan Mall location in New York’s Herald Square.
A team of disposition firms consisting of Gordon Brothers, Hilco Merchant Resources, Great American Group and Tiger Group have commenced store closing sales at 137 J.C. Penney stores across the U.S. The closures are the company’s first step in implementing a planned store optimization strategy.
Today, May 20, J.C. Penney has reopened 34 Texas stores, 12 Florida stores, 11 Ohio stores, and seven Indiana stores bringing the total it has operating to 153 after temporarily closings due to the COVID-19 pandemic.
J.C. Penney stated in a bankruptcy court document that it must emerge from Chapter 11 quickly in preparation for the 2020 holiday season, shortly after announcing that it had received approvals from the U.S. Bankruptcy Court for the Southern District of Texas regarding First Day motions related to the company’s voluntary Chapter 11 petitions, including approval for it to access and use its approximately $500 million in cash collateral.
As many anticipate a chapter 11 bankruptcy announcement, J.C. Penney made an approximately $17 million interest payment that was due and payable on May 7 regarding the company’s senior secured term loan credit facility.
With the coronavirus pandemic shutting down non-essential shopping across the U.S., J.C. Penney is said to be in advanced talks with bank lenders for a bankruptcy loan as large as $1 billion to carry it through a potential chapter 11 process, The Wall Street Journal reported.
In a filing with the United States Securities and Exchange Commission, J.C. Penney stated that it has elected not to make a $12 million interest payment set for April 15.
A range of retailers across channels are responding to the coronavirus outbreak with moves to temporarily close their stores, reduce store hours and other consumer and employee oriented initiatives.
Although comparable sales declined significantly, J.C. Penney earnings contrasted with Wall Street estimates for a fourth quarter loss.
J.C. Penney has appointed Karl Walsh, an executive with more than 18 years of e-commerce experience, as senior vice president, chief digital officer, to lead strategic advancements of the company’s digital platforms, most notably in its flagship store jcp.com.