J.C. Penney (OTCMKTS: JCPNQ) CEO, Jill Soltau, revealed Tuesday that the company hopes to withdraw from Chapter 11 bankruptcy before the holiday season.
In a news release, the retailer said it had filed a draft asset purchase agreement that ultimately brings the store chain closer to a sale with Brookfield Asset Management and Simon Property Group. The agreement is subject to court approval as well as other closing conditions and a hearing is set to take place in November. If all is approved, the close is anticipated to happen before December 2020.
A better understanding of the bankruptcy process is likely to provide a clearer picture for both the company and its vendors as they make arrangements for holiday shoppers. Amid the coronavirus pandemic and global economic crisis, many businesses are unsure of what the future holds.
According to Joshua Sussberg of the law firm Kirkland & Ellis, the mall owners are working to close the USD800 Million deal and save the retailer from bankruptcy. Sussberg added that the move would save approximately 70,000 jobs and 650 locations.
Along with plans to give ownership of J.C. Penney to Brookfield and Simon, they will also operate retail assets. Furthermore, 160 of the company’s real estate assets and distribution centers will be categorized as separate property holding companies owned by a group of its lenders.