As JC Penney moves closer toward a final sale to Brookfield Property Partners and Simon Property Group, the retailer expects to exit Chapter 11 before the holiday season, according to CEO Jill Soltau.
In a press release, Soltau said the final draft has been filed with the bankruptcy court. The $800 million deal would rescue the debt-ridden retailer and save more than 70,000 jobs and keep roughly 600 stores open.
A hearing is set for early November and the retailer is hopeful this will close its Chapter 11 case. The 118-year-old retailer filed bankruptcy in mid-May seeking to restructure more than $4 billion debt. Through this process JC Penney said it would close 240 stores this year, including four in Arkansas.
Analysts said if the retailer can exit Chapter 11 soon, it would have more clarity as it prepares what is predicted to a somewhat tepid holiday season.
The deal calls for Brookfield and Simon to acquire all of JC Penney’s retail and operating assets through an $800 million deal comprised of $300 million in cash and $500 million in new term loans. A group of first lien lenders will own 160 of the retailer’s real estate assets and distribution centers as part of a separate holding company, the company said.