J.C. Penney Halts Trading
J.C. Penney said Friday it has made the approximately $17 million interest payment that was due and payable on May 7.
Making the payment may be one form of J.C. Penney negotiating with its lenders. It has been in talks for a $450 million loan to finance bankruptcy plans. The troubled retailer would get half upfront and be required to hit certain goals to receive the second half of it, CNBC previously reported.
CNBC reported Thursday night the retailer was working on a bankruptcy filing that could come as soon as Friday. People familiar with the matter, who declined to be named, cautioned there is still a chance that final negotiations between the retailer and its lenders spill into the weekend and delay the filing.
The company had a grace period of five business days to make its May 7 interest payment, or else be in default. It said it continues to explore “certain strategic alternatives.”
The Plano, Texas-based retailer also skipped a $12 million interest payment on April 15, starting the clock on a 30-day grace period that expires on May 15.
Sales at J.C. Penney have fallen annually since 2016. Its roughly 846 store footprint is less than a quarter of its store base in 2001, and its nearly $11 billion in sales the last fiscal year are almost a third of its sales that year.
J.C. Penney employed roughly 90,000 full-time and part-time employees as of February. It is working on a plan that would contemplate closing 180 to 200 stores while in bankruptcy. The retailer had 846 department stores as of February.
The stock was halted at 9:28 Friday morning and resumed at 10:25 a.m. ET
