Simon and Brookfield reportedly in $800 million deal to acquire J.C. Penney

Two mall owners have come to the rescue of embattled J.C. Penney.

As of late Wednesday afternoon, Simon Property Group and Brookfield Property Partners had reached an agreement in principal to acquire the bankrupt department store retailer in a deal valued at approximately $800 million, reported The Wall Street Journal. The deal would keep the company afloat and keep most of the chain’s 650 remaining stores open. Penney filed for bankruptcy in May. 

Under the terms of the deal, Simon and Brookfield will pay roughly $300 million in cash and assume $500 million in debt and own about 490 Penney stores, the report said. A group of lenders will own 160 Penney locations along with the company’s distribution centers in return for forgiving some of Penney’s $5 billion in debt. According to the Journal, the landlords will pay the lenders rent on those 160 stores and distribution centers.

Wells Fargo has agreed to give Penney $2 billion in revolving credit once the transaction is completed, CNBC reported, leaving the retailer with $1 billion in cash. 

Penney plans to seek approval from the bankruptcy judge for the deal, which is subject to competing bids, early next month. 

This is a developing story. Check back later for updates.