JC Penney sees bankruptcy protection exit by Christmas

Local News

NEW YORK (AP) — J.C. Penney believes it will emerge from bankruptcy protection before Christmas under a new ownership agreement that would save tens of thousands of jobs.

The beleaguered, century-old retailer said Wednesday that it has filed a draft asset purchase agreement with the two biggest mall owners in the U.S. Substantially all of J.C. Penney’s retail and operating assets will be acquired by Brookfield Asset Management Inc. and Simon Property Group through a combination of cash and new term loan debt.

In September, the two mall owners announced they were close to making a deal to get J.C. Penney out of bankruptcy. The 118-year-old retailer filed for Chapter 11 bankruptcy protection in mid-May.

Details of the deal that will save roughly 70,000 jobs and avert a total liquidation first emerged last month during a bankruptcy hearing.

In June, J.C. Penney announced it would start closing 154 of its stores in what it is calling the first phase of its efforts to shrink its footprint.

J.C. Penney, which even before the pandemic had struggled to compete with the likes of Amazon.com, Target, and Walmart, became one of the largest retailers to file for Chapter 11 bankruptcy protection this year amid a wave of store closures forced by the spread of COVID-19 infections in the U.S.

More than two dozen retailers have filed for bankruptcy protection since the pandemic closed stores, restaurants, gyms and other businesses across the country.

The Plano, Texas, retailer will shed nearly a third of its stores in the next two years as it restructures, leaving just 600 locations open.

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