Majors

Simon, Brookfield to Acquire JC Penney

MajorsSep 15, 2020

Simon, Brookfield to Acquire JC Penney

The proposed deal would keep 650 locations open and save 70,000 jobs.

JC Penney may soon be acquired by mall owners Simon Property Group and Brookfield Property Partners.

Plano, Texas—JC Penney may be saved after all.

Simon Property Group and Brookfield Property Partners are finalizing an $800 million deal to buy the department store chain.

The mall owners will pay $300 million in cash and assume $500 million in debt, according to a statement by Joshua Sussberg of the law firm Kirkland & Ellis, which is representing JC Penney.

The move would allow the retailer to avoid liquidation, said Sussberg.

The deal would keep 650 of its 850 locations open and save 70,000 of its 85,000 jobs.

“We are in a position to do exactly what we set out to do at the very beginning of these cases, and that is preserve 70,000 jobs, a tenant for landlords, a vendor partner and a company that has been around for more than a century,” he said during a hearing last week.

Licensing company Authentic Brands Group may join in on the plan, according to a Business Insider report.

The company has joined forces with Simon and Brookfield before, acquiring Forever 21 earlier this year and Aeropostale in 2016.

When the deal goes through, creditor Wells Fargo has agreed to give JC Penney $2 billion in revolving credit, leaving it with $1 billion in cash.

The retailer filed for Chapter 11 bankruptcy protection in May as it struggled with the effects of the coronavirus pandemic and its mounting debt.

In exchange for forgiving some of its $5 billion in debt, its lenders, including H/2 Capital Partners, will take ownership of some of its stores and distribution centers.

In June, Sussberg valued JC Penney’s real estate portfolio at $1.4 billion when its stores are operating and $704 million when they’re not.

The retailer will seek approval for the deal in early October and expects to emerge from bankruptcy before the holiday season.

Lenore Fedowis the associate editor, news at National Jeweler, covering the retail beat and the business side of jewelry.

The Latest

Recorded WebinarsJan 14, 2022
Watch: What Will 2022 Bring?

Sherry Smith, Peter Smith and Edahn Golan join Editor-in-Chief Michelle Graff and try to answer the question, how long will the party last?

EditorsJan 14, 2022
See a Few of Betty White’s Best Jewelry Looks

Editor-in-Chief Michelle Graff celebrates the Golden Girl’s jewelry style ahead of what would’ve been her 100th birthday.

TrendsJan 14, 2022
All About Megan Fox’s Engagement Ring from Machine Gun Kelly

Designed by Stephen Webster, it’s a ring-stack take on the toi et moi style.

Brought to you by
Melee the Show Launches Tucson Event, Returns to New York in 2022

The boutique tradeshow, happening first in Tucson then New York City, brings together upscale designers from around the world.

GradingJan 14, 2022
GIA Names Anna Martin SVP for Institute, Industry Relations

She previously served as its senior vice president of business development and beneficiation.

Weekly QuizJan 13, 2022
This Week’s Quiz
Test your knowledge of the latest jewelry news with this quick test.
Take the Quiz
TrendsJan 14, 2022
Piece of the Week: Made by Malyia’s Plunging Ocean Wave Hoops

Combining thoughtful design and wearability, they were a standout of 2021.

SourcingJan 13, 2022
Part of the Red Beryl Mine Is Producing Again, One Owner Says

Red Emerald Inc., which is under new ownership, started mining at the Utah site last spring.

Brought to you by
Rare & Forever Can Help You Tell A New Story At The Counter And Close More Sales!

A.I. technology is revolutionizing the jewelry business through more accurate and consistent diamond grading.

Policies & IssuesJan 13, 2022
There’s Still Time to Sign Up for BIJC’s IDEA Sessions

The first session is scheduled for Jan. 19 and focuses on addressing racial justice and confronting one’s biases.

×