A private equity group is reportedly bidding $1.75 billion to purchase the bankrupt J.C. Penney department store chain.
According to the New York Post, Sycamore Partners aims to acquire J.C. Penney with the goal of merging the retailer with its North Carolina-based Belk department store chain. Belk operates roughly 300 stores in the Southern U.S. Sycamore reportedly seeks to combine the two retailers with the ultimate goal of creating a national department store chain that could directly compete with Macy’s.
Sycamore was initially reported to be in negotiations to purchase J.C. Penney in June. Other leading bids reportedly include a $1.7 billion offer from Hudson’s Bay Company (which owns Saks Fifth Avenue) and a joint $1.65 billion tender from mall operators Simon Property and Brookfield Property. No bid has been accepted yet.
J.C. Penney, which filed for bankruptcy protection in May 2020, subsequently received approval from the bankruptcy court to access its debtor-in-possession financing, which included $450 million of new money from its existing First Lien lenders.